By Chris Cobb | Associate
Welcome back to the Big3 with CC, your weekly real estate investment source. For all the sports fans out there, I’m sure you saw the Boston Celtics lose one of their Big 3, Gordon Hayward, to injury. Spoiler alert, it’s gruesome to watch so buyer beware…
Today we breach a new topic, Multifamily Development and Usage. It has been gaining some steam as an investment over the past few years, here are some reasons why:
With loan payments nearing all-time highs for recent graduates, most are forced to rent properties for a longer period. Depending on the structure and school attended, most exit college already saddled with a mortgage payment. In addition, Millennials prefer to spend their money on experiences such as travel rather than real estate. However, that trend may be taking a turn as Millennials age and become Americas most populous group.
As the Millennials increase, the empty-nester Baby Boomers increase as well. Since the turn of the decade, the number of townhome rentals has increased by $4.3 million. These low-maintenance units offer an affordable option for those looking to downsize. Seniors can also benefit from community style multifamily developments that provide common area shared activities and programs such as swimming, dances, mixers, or even an on-call nurse or doctor.
Regulation Regulation Regulation
The Dodd-Frank Wall Street Reform, Consumer Protection Act, and The Housing and Economic Recovery Act of 2008 require financial institutions to secure stronger capital and liquidity positions. The rules have also spawned new regulatory entities, such as, the Consumer Financial Protection Bureau (CFPB). More stringent regulations and practices from the CFPB have influenced how lenders make loan decisions. They have left consumers facing tougher criteria to secure a home mortgage as lenders have reduced their mortgage volume. The Trump administration stated that it intends to loosen these regulations over the coming years, however, little has been done yet.
When it concerns real estate, invest yourself.