My Hard Money Lenders Multi-Family Real Estate Predictions

Multi-family housing construction is doing remarkably well in today’s real estate market. Multi-family housing constitutes five or more housing units and currently makes up 25-percent of all new housing construction. In fact, in 2014, multi-housing boomed, compromising 35-percent of new construction.

Why is multi-housing becoming so popular? As the children of baby boomers age, they are more likely to live in apartments than older adults are. Another apartment dwelling factor is lifestyle. Many city dwellers prefer walking to work to avoid long commutes, which generally offers more nearby apartment offerings.

While multi-family units are holding strong in the real market now, five to 10 years from now may prove to be a different story. However, for the time being, real estate investors can enjoy the profitability that apartment homes offer. At some point in the future, investors may want to consider diversifying their investment portfolios to include different types of real estate.

In the meantime, apartment building loans are very difficult to obtain from traditional banking institutions. There are traditional multifamily loan products available, but they can take several months to obtain. These include Fannie Mae Financing, Freddie Mac Financing, FHA Financing, Construction Financing, Conventional Multifamily Financing, Conduit/CMBS Multifamily Financing, Commercial Real Estate Insurance Financing and USDA Financing. Going through a direct lender proves easier for most real estate investors, as they focus on the profitability of the apartment dwelling instead of the buyer’s credit. Additionally, many banks look at property types, such as affordable housing, manufactured housing, cooperative, hospitals, skilled nursing facilities, memory care, hotel/motel, retail/office, self storage, industrial/warehouse, mixed use, student financing, military housing, cooperative housing or senior housing.

The following cities have the top multi-family markets.

1. Oakland, East Bay
2. Portland, Oregon
3. San Francisco, California
4. San Jose (Silicon Valley)
5. Miami, Florida
6. Houston, Texas
7. Denver, Colorado
8. Seattle, Washington
9. Orange County, California
10. San Diego, California

The best markets for multi-family invests include:

1. Nashville, Tennessee
2. Los Angeles, California
3. Minneapolis, Minnesota
4. San Diego, California
5. Denver, Colorado
6. New York, New York
7. Bay Area, California

References:
http://www.forbes.com/sites/billconerly/2014/05/19/multi-family-real-estate-forecast-2014-2020/
http://nreionline.com/multifamily/top-10-multifamily-markets#slide-10-field_images-526031