There’s no denying that our clients in the property management industry see the occasional risks and set backs in real estate. This is par for the course. Still, historically, despite the hiccups, single-family rents have always been sound investments.
But what about in today’s market climate? Are market fluctuations impacting the assets in investors’ portfolios?
From what we’re hearing from high net-worth investors, those assets will remain safe and YES, single family real estate investments remain solid.
In fact, according to a recent survey by financial services company Millennium Trust, a staggering 90% of people are inclined to invest in alternative assets of which real estate is the top choice.
Investments Grow Thanks to Baby Boomers and Millennials
Single-family rental properties are at the top of real estate and of interest to a whopping 73% of high-net-worth real estate investors, as stated in the Millennium trust study. Some trends believed to be causing the interest (and continued growth) include downsizing baby boomers, as well as millennials choosing to rent longer so they can keep their options open.
The Future is Even Brighter
What does the future hold?
Some experts believe, in the long term, 13 million additional homes will hit the market by the year 2030, adding to already existing 16 million assets. And in a recent US News and World Report article, Quinn Palomino, co-founder and principal at Virtua Partners in Sand Diego, believes that the near future is bright.
In the article, Palomino states “demand is high, and supply is still constrained, particularly for entry-level housing. We anticipate rent increases will outpace the overall commercial real estate market, landing in the 5 to 7 percent range.”
She also believes that single-family rentals will beat the stock market in 2019 due to low rates and low unemployment.
Urge Your Investor Clients to Build Their Portfolios
The key is to encourage your real estate investor clients to advantage of good market conditions—not just in the short-term, but to build their business and prepare it for the extended future. Make sure they have the right tools to help take their rental business to the next level, keeping everyone happy along the way.