We all know about the multifamily housing sector, that’s what we do here at PQP. If you aren’t familiar with the market right now though, you may be surprised to find out that over the past 18 months the market for multifamily housing has boomed.
This market has always been strong, but according to the Real Capital Analytics Commercial Property Price Index, the apartment sector climbed 23.6% in 2021—which is even higher then when the first real estate crisis that happened back in March of 2007. I did the math for everyone, and if the price went up 23.6% in 2021 and the average price for an apartment building in 2021 was $459,212, then years prior an apartment building was going for sale for around $108,375. That is a giant increase in sale prices in just a year.
But it makes sense. So many people are choosing to rent an apartment over buying a house because of how high mortgage rates are right now. In 2020-2021 mortgage rates fell to the lowest they have ever been at 2.65%, but today’s mortgage rates are averaging around 4.71%–that’s almost double what it was a year ago! With those kind of numbers it makes sense for families and older generations of people to want to rent instead of trying to come up with the money for a mortgage.
With that all in mind, now is the perfect time to invest in this market. Apartment buildings are in such high demand now, it is a first-come-first-serve field for people who are applying because there are so many applicants. For people looking to rent it makes it a tough market, but for investors it is a fantastic market. It means that there are more opportunities for an investor to put money into a syndication and get a return back because of how much people need to find a place to live.
So, if you are interested in learning more about becoming an investor here at PQP, please reach out to us at info@pqpllc.com or call us at (888)-840-6612.
