Are you thinking about investing in a multifamily 2020 property, but you’re not sure if it’s the right decision to make because of Coronavirus?
In this article, I’ll break down some of the most recent developments in the multifamily market to provide you with insight into what’s happening right now and what we can expect from multifamily Real Estate in the months ahead.
Virtual and Contactless Tours Are Thriving During Coronavirus
There’s no doubt that Coronavirus has impacted the passive real estate investing multifamily market in ways that we previously could not imagine. Still, the good news is that despite lockdowns in most major cities across the United States, the demand for multifamily remains strong and owners are embracing technology to meet that demand.
Most owners, or property managers, are turning to the internet to market their listings via virtual or contactless tours that don’t require any contact with potential tenants.
Virtual or contactless tours are still new to the real estate passive income multifamily industry but recent data has shown that roughly 32% of renters surveyed indicated that they preferred using a service like Rently.com to self-tour a multifamily property rather than waiting to meet a manager to walk them through it.
More People Are Renting Multifamily 2020 Than Ever Before
Thanks to recent data from the United States Census Bureau, we know that more Americans are renting than at any point in the last fifty years.
Roughly 37% of individuals surveyed in the 2020 United States census confirmed that they are living in rental properties and the vast majority of renters are living in the nation’s biggest cities including Chicago, Los Angeles, New York, and Houston Texas.
This data makes sense because most of the cities mentioned above also have had the highest property prices in recent years and this has driven the average person to rent versus buying a home.
In spite of the challenges poses by Coronavirus, the simple fact remains that people still are going to need a place to live and renting a unit in a multifamily property remains one of the easiest ways for anyone to have a place to call home without having to have the traditional hassle of maintenance that comes with renting a single-family home.
Multifamily Deals Are Moving Off Market
If you plan on buying another multifamily 2020 property in the coming months, you should first look for a property that’s off market compared to a property that’s listed on the MLS.
Most owners who are interested in how to create passive income in real estate, were planning on selling their multifamily properties before Coronavirus don’t want their properties to be perceived as being “distressed”, so they’re keeping them off market to avoid the hassle of having to deal with buyers who may be looking for below market deals on multifamily properties following the coronavirus pandemic.
Off Market deals are generally more desirable than properties that are listed on websites like realtor.com, Zillow or the MLS because of the simple fact that an investor who is attempting to purchase a property that’s listed online is going to have to contend with competition from other buyers.
Off-market deals are also more advantageous for sellers as well, too, because it enables them to have the privacy they want when selling their properties since most owners don’t like to publicize to their tenants that they’re thinking of selling since they don’t want to scare their tenants and cause them to move out before they’re able to sell.
How to Find Off-Market Deals
If you’ve never purchase multifamily properties off market before, the good news is that it’s easy to find off-market deals especially when you do the following:
Connect with local Real Estate Agents – Connecting with real estate ira or local real estate agents is by far one of the best ways to find off-market multifamily deals because of the simple fact that most agents are highly connected with sellers and they may be able to refer you to one or more of their clients that may be thinking of selling their properties.
Real estate agents also are known for having “pocket listings” or properties that they have exclusive rights to sell that are not listed on the MLS. Pocket listings benefit the seller, but they also provide benefits to the buyer as well because a buyer doesn’t have to contend with multiple offers and competition from other buyers who are interested in the same property.
Use Online Services – Besides connecting with local real estate agents to find off-market multifamily properties, another excellent way to find off-market deals is to utilize resources like Roofstock, Facebook, Bigger Pockets, or any website which has groups were multifamily owners and investors hang out online.
Direct Mail – Even though most people prefer to send email in 2020, Direct Mail marketing is another excellent way to connect with owners who are potentially interested in selling their multifamily properties.
Yes, most people shy away from sending Direct Mail because they think that it’s an ineffective form of marketing. Still, the reality is that if your direct mail piece is presented correctly, it stands to reason that it has a higher chance of being opened compared to any cold email that you may be thinking about selling.
Contractors – Another excellent way to find off-market multifamily deals is to connect with local contractors in the area. This is a smart move to make because of the simple fact that there’s going to be owners in the area who want to repair or renovate their multifamily properties before selling them and they will need to hire contractors to work on those properties.
Connecting with local contractors will put you in the right place, at the right time because you may be able to connect with the right contractor who is currently working on a property that an owner is planning on selling in the near future.
Driving for Dollars – As I mentioned in my previous posts, driving for dollars is one of the best ways to find potential off-market multifamily properties in any area
The first thing that you should be looking for when you’re driving for dollars is distressed properties. These are properties that are obviously in need of maintenance and may have an owner that’s unable to keep up with repairs.
A distressed property also means that it could be owned by an out-of-state owner who hasn’t visited the park in sometime
Wholesalers – Besides the tips that I’ve already mentioned in this article, another excellent way to find off-market multifamily properties in any area is to connect with wholesalers. These are individuals or companies who find off-market deals, get those properties under contract, then flip the right purchase the property to another company or buyer for a one time “finder’s fee.
County Records – Let’s say during the process of driving for dollars, you found one or more properties that you would be potentially interested in purchasing. The next step is to obtain the contact information are the owners of those properties, but the question is, how do you get in contact with those owners? The answer to this question is public or county records.
When you access public records, you should be able to quickly determine who owns property in any city or county across the United States. Once you obtain the owner’s physical mailing address, you’ll still have to go through the process of marketing to them via direct mail or cold calling them, so you must have the right strategy before you take steps to move forward with communicating with them
Multifamily Development Stalled for Next 12 Months?
Back in January 2020 was projected to be another massive year for the multifamily real estate market since it was expected that roughly three hundred thousand new rental units were going to be coming to the mark by the end of the Year.
Sadly, due to Coronavirus and stay at home orders cross the United States, we can expect to see only about 250,000 new units come to market by the end of the Year.
Contact Trier Capital
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Why spend the time and money investing in another multifamily 2020 property yourself when you can partner with us and let our team simplify the process of multifamily investing for you?
To learn more about the services we can offer you contact us today by calling (630) 229-2383 or click here to connect with us online.