Multifamily State of the Industry Report: 1st Half 2019
Start the year on the right track with G5’s newest Multifamily State of the Industry report. This comprehensive industry overview focuses on market trends – the factors influencing supply and demand, construction starts, and what is driving the industry. The report also details current obstacles to multifamily policy, multifamily search and digital advertising trends, and the top 10 markets to watch in 2019. We close the report with insights of the digital marketing landscape and tactics to include in this year’s marketing plan.
Key Takeaways: Market Trends
Staying competitive in your market – and taking advantage of a diversified investment portfolio – begins with knowing current market trends across the multifamily industry. Based on our research, we’ve compiled the following key takeaways to monitor this year.
- In 2018, construction of new units was down 5.5% YoY; and down 16% from it’s most recent peak in 2015. This trend is due to a labor shortage and increased costs, not a lack of demand. Demand remained high for all property classes, with the greatest demand for affordable and workforce housing.
- Although new construction starts are slowing, there are more properties on the market than ever before and the number continues to grow. This means increased competition throughout the industry, especially for Class A apartment communities in urban centers which saw the lowest rent growth of 2018.
- Millennials and baby boomers are the biggest drivers of demand for multifamily living, but Gen Z is starting to enter the marketplace with an entirely new expectation of service.
Comprehensive Industry Overview
Our industry overview includes a summary of the policies that currently dictate aspects of multifamily community investments. We review Fair Housing laws, Low Income Housing Tax Credits, and Middle-Income Housing Tax Credit, as well as how each policy spurs the development of workforce housing and protects the interests of apartment owners.
Next, we include real estate marketing insights, including multifamily search and digital advertising trends from Q3 2018. Finally, we list the top 10 markets to watch in 2019, based on the number of completions as percentage of total stock.
What’s Next on the Digital Marketing Landscape
The customer journey has changed and marketers need to adapt their strategies to be present at each touchpoint. If you haven’t upgraded your digital marketing platform recently, the two most important tools to invest in are your website and AI-powered digital advertising.
Websites must be optimized for local search in order to compete with the number of new properties coming online in 2019. Next, be more competitive with personalized experiences and a high SERP ranking with digital advertising fueled by AI.
Stay Competitive by Knowing Industry Standards
Knowing the full range of market trends and emerging obstacles gives you the confidence to make informed, bold decisions for your multifamily investment portfolio. G5’s 1H 2019 State of the Industry Report includes data-driven analysis, predictions, and insightful strategy that will help you make the most of your budget and time as you plan 2019 marketing tactics.