Cover Story: Why Investors Are Flocking to Multifamily
Brokers specializing in affordable housing echo that experience. Most properties are typically receiving multiple offers today, brokers say, as investors rotate out of more risky assets that were exposed during the pandemic and seek diversification. But because of the complex regulations and compliance requirements associated with affordable housing, newcomers to the market tend to be professional real estate investment firms that have either acquired or established an affordable housing division.
“Affordable housing wasn’t that appealing to many investors 10 years ago, or even five years ago,” proclaims Brandon Pyle, senior analyst with Colliers Affordable Housing Group in Irvine, California. “But with COVID, everybody started to see the value in what is an extremely stable asset.”
Indeed, while industry observers expected rent collections in the affordable housing segment to decline, it never happened, largely due to the efforts of management to check in with residents as well as the pride that tenants have in the communities, adds Kevin Morris, leader of Colliers Affordable Housing Group in Fort Lauderdale, Florida.
“When you compare pre-COVID collection numbers to post-COVID, there was not a marked difference,” he explains. “Tenants know they have a good deal — their rents are lower than anywhere else in the area — and at the end of the day they want to protect that.”
