Sir Francis Bacon coined the term “Knowledge is power” over 400 years ago. It’s as true today as it was back then, especially when it comes to the multifamily real estate market.
Whether you are a developer, owner-operator or investor in multifamily properties, it’s essential to keep up with the market both in your local area as well as across the country. This will help you maximize your investment and stay ahead of competition in the market.
Why You Need to Track the Multifamily Real Estate Market
Anticipate Problems Before They Start
Staying informed about problems that other multifamily property owners are facing can give you a chance to assess your own property for similar issues. For instance, many property owners are experiencing issues with tenants subletting space in their rentals on sites like AirBnB. This could put owners and operators at risk of being liable for anything that happens on the property. That’s a big issue, but one that you might not have anticipated beforehand. Knowing that others are dealing with this problem can help you proactively create clauses in your rental and lease agreements to avoid those same issues.
Know What Your Competition Is Up To
You need to know what your competition is doing. Industry newsletters, reports on local news stations, and local papers can help you stay up-to-date on what’s happening with the market.
When you know what the competition is up to, you can create a strategy to protect your investment. Someone could be planning a new multifamily property development near your own, meaning you’ll need to act quickly to attract and retain residents.
Likewise, you need to know what the competition is offering so you can stay competitive. A lot of multifamily sites now offer package delivery spaces. It’s an in-demand trend and one you should be paying attention to. Knowing that your competition is offering it early on gives you time to consider investing in an Amazon locker service or possibly repurposing space in your lobby.
Stay Up to Date on Legal Changes That Could Affect You
You don’t want to get caught out by changes to local and national legislation that has a negative impact on your investment properties. Knowing what local authorities are proposing can help you evaluate their potential negative or positive effect.
Staying informed can help you organize action protesting negative changes and potentially proposing alternative measure instead. For instance, many local authorities are introducing bills that could significantly impact the rental industry. In Colorado there are proposals to regulate tenant application fees, reduce the use of criminal background checks in screening tenants, and allow tenants more time to cure a lease violation.
This could end up capping the potential income from your property and tying your hands when it comes to cash flow and new investments. It’s better to know that a proposal is on the table than to hear about it after the measure it passed.
Gain Knowledge About When to Buy and Sell
Are you purchasing your first multifamily property investment? Are you ready to add another one to your portfolio? In either case, you need to know when and where to buy. Likewise, no investment is good unless you know when to sell it.
Staying informed about market trends can help you maximize your investment dollars. Developing your knowledge about the market can help you identify the next hot market as well as the optimal time to walk away from current developments.
Find Out What People Want (And What They’ll Pay)
Do you know what your residents want? Sometimes a relatively small investment in a trendy amenity can help maximize the market value of your property. But you have to know what those hot amenities are and what your residents will be willing to pay for them. This is where staying informed can pay off big.
Stay up-to-date on what amenities people want and what the hottest properties are offering. It may be something big like a business center or something as small and simple as a space for a game of cornhole (it really is fun!). Finding out what people want in their rental property can help you get more from your investment dollars.
How to Efficiently Keep Up With the Multifamily Real Estate Market
- Create Google alerts for key terms. Let Google news know what you want to stay up-to-date on and it will do the rest. Consider adding alerts for terms like “rental market + your town name” or “multifamily real estate market.” Any news articles containing those terms will come right to your inbox.
- Network with others in the real estate industry. Real estate brokers, builders, property managers are all a wealth of information. Take time to talk to them and get the benefit of their knowledge about what’s happening both in your area and at the national level. You can network in person or through social media channels.
- Subscribe to industry magazines and your local paper. Whether you read them online or get them delivered to your door, these are valuable resources to multifamily real estate insiders. We highly recommend Apartment Finance Today and Multi-Housing News, both of which are free and packed with industry news. Your local paper will have information on legislation, building projects, and housing market news as well.
Looking for more ways to stay informed about the multifamily real estate market? Make sure you check out our Twitter feed for industry articles and other great resources. You can also get in touch with our team today for a consultation about meeting your multifamily property goals.
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