2018 will be another strong year for the multifamily industry. That was the sentiment echoed at the NMHC Apartment Strategies Outlook Conference held in Orlando last month. The event brought leaders together for a day of thought leadership and presentations one day prior to the NMHC Annual Conference.
The event kicked off with the 2018 Economic Outlook and Market Implications, which revealed that there are few signs of recession for 2018 and 2019. While the industry may slow down long term, the next few years will continue to carry forward momentum. Multifamily firms will likely see a robust market in the immediate future.
Conference presenters also emphasized that it's still an ideal time to be investing. Interest rates are rising slightly, but there is plenty of capital available. As demand continues to hold, it's a positive time to be an investor in the multifamily market.
Below are just a few of the core takeaways from NMHC’s Strategies Conference:
- Demographics are slowly shifting. As more millennials and baby boomers choose to rent instead of own, resident demographics are changing. For the foreseeable future, apartments will continue to be sought after by older Americans due to lifestyle choice, downsizing needs, and the high cost associated with home ownership.
- Secondary and tertiary markets present unique opportunities. More and more cities, like Raleigh, Portland, and Austin, appear to be great markets for apartment investors. With secondary markets experiencing booms in job and population growth, more and more residents are seeking convenient, stylish housing to accommodate them.
- Package management continues to be a challenge. As more residents shop online, the number of packages delivered to apartments is steadily increasing. The volume of packages is creating issues at apartment communities of all types, from garden style to high rise. During the conference, leaders discussed potential strategies for dealing with increased package delivery including storage facilities, lockers, and drones.
- Demand will hold as 4.6 million units are needed by 2030. Revealed in 2017 by NAA and NMHC, greater supply is needed to keep pace with demand. With 12 years left to build 4.6 million new units, the industry will need to build over 300,000 units per year to keep up. This bodes well for developers and means that construction will stay strong in a number of markets.
“At this year’s NMHC Apartment Strategies Conference, speakers shared a continued sense of investor optimism and strong market fundamentals for multifamily,” said Kevin George, President and CEO of InfoTycoon. “Despite rising interest rates, institutional investors continue to place new capital into multifamily and view real estate as an attractive asset class. Moving forward, transactions activity will remain strong and I’m proud our inspection and lease file audit platform is the go to solution. Additionally in 2018, owners and operators will have a renewed focus on operations to drive asset value. We’ve made some exciting enhancements to our platform to align with this strategy, including a suite of business-process focused modules that substantially improve NOI.”
To learn more about the NMHC Strategies Conference, visit https://www.nmhc.org/ASC/.