We are all asking the same question. “Will the multi-family real estate market survive the pandemic?” It is at the forefront of our minds. We have spent so much time, money, and energy investing in the multi-family market and all we want to know is that when this is all over, we will be able to count on our investments and not go belly up. And while we are neither financial analysts nor are we economic experts, here is what we believe to be true about the real estate market after Covid-19.
People Will Still Need Housing
No matter what, people will always need housing. While many landlords are deferring rent payments, and while they are taking a hit financially, they also know that at the end of this, their tenants will be more likely to stay than to move. Partly because people tend to stay loyal to those who help them out, and partly because moving is costly and at this point in time, quite the hassle. At the end of this, we will probably see that unlike previous months, mid-range rentals will out-perform high end, luxury rentals. Which isn’t a bad thing for those of us who have been holding on to B & C class properties.
Cash Flow is King
One of the regrets of the 2008 housing crisis was that investors didn’t hold on to their properties that had a good cash flow. It feels pretty reckless to hold on to property when the economy gets wobbly, but in a few months, when things have started to stabilize again, we will see that holding on to these properties gives us a leg up and the ability to jump right back into business. That’s not to say that it will be easy, but if you can hold on to your properties that produce a decent cash flow, you probably won’t regret it.
Amenities
One thing that is becoming clear in the midst of this pandemic is that properties with more amenities are doing well. As people are unable to leave their homes and businesses are closed, we are seeing that properties with business center services, package acceptance, on-site gyms, and basic supplies are doing very well. They give individuals the ability to stay isolated all the while providing them with the services and abilities that they require to work from home or to simply stay sane during this challenging time.
As we traverse the next few weeks, months even, remember that real estate is always a little tricky, and while this time in history may be far more rocky than you’ve ever experienced, we will all get through it! If you need additional support or information during this time, don’t hesitate to reach out and let us know how we can help you. Head over to our contact page and let us know what we can do to help you as you continue to invest and educate yourself!
