With the COVID-19 outbreak and subsequent stock market plunge, the first quarter of 2019 delivered a shock to the United States as citizens hunkered down at home and companies grappled to adjust and weather it out. While the economic effects will be measured in the months and years to come, many in the apartment sector are looking now at the immediate and projected impacts on rentals.
Multifamily performed extremely well over the past decade, nearly immune to dynamics that impacted other real estate classes. The sector remained strong into the first quarter of this year. Solid fundamentals and demand, as well as short supply in key multifamily categories, continued to carry it through. However, as we wade through these unchartered waters, the big question is: Will rental housing maintain its performance?
Prior to the virus outbreak, experts agreed the real estate cycle was mature. Even as many debated the possibility of a downturn, demand for apartments remained high in part because various groups—college students, workers, singles, couples, families—consistently sought units. Notably, a look over time indicates these target groups are continuously replenished by younger up-and-coming generations. A prime example today is older millennials moving out of apartments to purchase homes and being replaced by younger millennials.
Suraj Shrestha is an associate at Harborside Partners. He has been taking the lead role on research projects; to develop and implement online marketing strategies for search engine optimization and social media marketing. He is one of the core parts for helping to grow business revenue and the company’s online presence.