1. Longterm Renting
Only about half as many millennial are able to afford to own a home like boomers could a few decades ago. Even those who can afford to buy a home in the suburb often prefer to rent because it allows for more flexibility and proximity to work. More and more young professionals are instead choosing to see renting as a long-term housing solution.
2. Newly Constructed Luxury Rentals
The increased number of upper and middle-class rentals is leading to investors constructing luxury apartments with fancy appliances and amenities. These luxury rentals appeal to well-educated workers with money to spare and are often situated in city hubs. There is especially a growing interest in this in mid-sized, affordable cities like Charlotte, Houston, and Atlanta.
3. Single-Unit Rentals
Due to the increased interest in renting, there is more of a demand for single unit rental homes. This shift is good for investors because directly owning a home and renting it out to people often allows for higher profit potential. Single-family rentals do not usually shift with the stock market, making them a way to diversify a portfolio.
4. Multifamily Housing
Many people are starting to get creative with how they consider real estate. There are fewer people looking to strike out on their own and get single-family homes now. Instead, there is a big spike in multigenerational housing with summer homes, garage lofts, and mother-in-law suites accommodating several families in a single home. More adult children and elderly parents are living together, and there is also an increase in people who rent out bedrooms or have roommates even once they start a family.
5. More Joint Ventures
Investors can expect to see a lot of large capital partners partnering up with REITs to launch real estate ventures. This is happening because REITs had a very strong performance last year, and large capital partners provide more assets and management that can be used to advance this investment method.