How is multifamily investing affected by COVID-19? A survey done by Institutional Property Advisors (IPA) reveals that nearly two-thirds of respondents said firms expect only a slight decrease in multifamily rents of the next six months and almost 41 percent anticipate vacancy rates will stay the same or decline.
These numbers may be shocking or overly optimistic to some since the future effects of COVID-19 are unknown, but we are seeing some truth to these statistics right now with our own assets. The number of new leases our management teams have been able to close in recent weeks are lower than last month albeit not by much to our surprise.
Multihousing News reports that the COVID-19 pandemic is providing some operational challenges with social distancing halting property tours. While the virtual leasing experience is working with prospective residents, virtual tours, however, will not be embraced as a replacement for acquisitions purposes. Seventy percent of firms say they would not purchase a property based on a virtual tour. This has caused almost forty percent of firms putting all acquisition activity on hold.
While out of abundance of caution we at Casoro Group are not physically touring properties, we are continuing to evaluate and underwrite new opportunities. Due to the lack of clarity on COVID-19’s health and economic repercussions, the Acquisitions Team is keeping their ear close to the ground for potential acquisitions.