James Kandasamy of Austin Texas, leader in multifamily investing and author of two best sellers, speaks on his experience with guiding individuals to real estate success. In the following article, James Kandasamy discusses the growing trend of multifamily housing investing, and why it has become so popular as a wealth building strategy.
The coronavirus pandemic sparked a blazing multifamily investment fire, as Americans tend to rent these units for much longer, due to newfound flexibility and ongoing economic uncertainty.
As 2023 continues, it appears the rise in multifamily investing isn’t slowing down anytime soon. In fact, it appears to be getting stronger, showcasing increasingly exciting trends as one month passes and the next arrives. However, understanding why the multifamily market is experiencing this boom is paramount for economists and investors looking to figure out precisely where it’s headed.
James Kandasamy of Austin Texas Explains the Driving Forces Behind the Rise
Over the past 12 months, house prices across the United States of America have risen by a soul-crushing 20%, pricing most people out of the home-owning dream and keeping them in rental units. In addition, despite monthly rent rates rising by roughly 10% last year, occupancy is high in all metropolitan areas.
James Kandasamy of Austin Texas says that for Millennials and Gen Z, renting is typically unavoidable — they simply cannot afford to purchase a house. Older Millennials, who are currently in their 40s, are hit hardest by this unfortunate fact.
However, the main driving force behind the rise of the multifamily market seems to come from the increasing popularity of lifestyle renting, a trend involving renting because it’s sensible for affluent young generations choosing a different path from their predecessors.
James Kandasamy of Austin Texas explains that, boasting busy social and work lives, younger individuals want to live near city centers for easy amenity access while moving whenever they fancy it. Thus, lifestyle renting is the go-to decision, helping multifamily investors build substantial wealth.
Diving Into How the Multifamily Investment Niche Is Expanding
Usually, the real estate market sticks closely to trends exhibited by the larger economic market. However, due to uncertainty surrounding the current wider outlook, it’s impossible to precisely pinpoint the direction of the multifamily market.
That said, experts maintain that rent prices aren’t going to stop rising, and house prices will likely follow this trajectory as well. As for mortgage rates, they’re still keeping first-time purchasers out of the market, ensuring that they remain in rented accommodation.
James Kandasamy of Austin Texas notes that Gen Z members are fleeing the nest in search of independence, which is naturally helping the multifamily sector expand beyond all previous predictions. However, both Millennials and lifestyle renters are picky about where they choose to lay their heads. It appears they will continue insisting on the significance of outdoor areas, security, and office space when renting inner-city units.
With all that in mind, investors need to be careful about the type of multifamily ordeal they put their money into if they intend to take proper advantage of the growing market.
The Future of the Multifamily Investment Market Through 2023 and Beyond
James Kandasamy of Austin Texas notes that the positive direction in which the multifamily industry is headed certainly bodes well for interested investors, and has given rise to a few niche trends.
• Green Structures Take Center Stage
The entire real estate sector is doubling down on green buildings and sustainability — a trend likely to continue for the foreseeable future.
James Kandasamy of Austin Texas explains that multifamily units in particular are acquiring increasingly ecologically conscious amenities, including water-saving practices, solar panels, energy-efficient built-in appliances, and living roofs/walls.
• A Health and Wellness Focus
The multifamily market is expected to follow the trend of health and wellness that was initially reinvigorated during the COVID-19 pandemic. To accommodate the unrelenting demand for healthy living, developers are focusing on adding gyms, meditation spaces, yoga studios, and similar facilities to their projects.
• Smart Homes Brought to the Forefront
Renters, especially younger individuals, are becoming increasingly interested in smart home tech, and as such, multifamily investors are accordingly incorporating these innovations into their projects.
James Kandasamy of Austin Texas says that, while this isn’t a widespread occurrence yet, voice-activated assistants, smart thermostats, and automatic window treatments will likely become the norm as time ticks forward.
• Co-Living Spaces Increase
Co-living spaces, wherein standard rooms are shared, are becoming surprisingly popular with younger tenants. This trend is causing developers to focus more on building co-living facilities that offer distinctive features to stand out from the crowd.
Multifamily Investments — The Ticket to Wealth Building in Real Estate
James Kandasamy of Austin Texas explains that as the renting sphere grows increasingly populated, it seems multifamily investments will remain a valuable way to create substantial wealth for real estate investors throughout the United States.
