The COVID-19 pandemic has negatively affected virtually every financial industry, including the multifamily real estate industry. To minimize these impacts and ensure that your multifamily real estate business can survive the pandemic, it’s important to understand and prepare for the future of multifamily real estate after COVID-19.
In this article, we’ll highlight the most relevant COVID-related trends in multifamily and how your business can respond to them.
Impacts on Student Housing
As universities move toward an internet-based learning model to prevent the spread of COVID-19, many students don’t have to be physically present in their university towns anymore. An increasing number of students are staying in their home cities instead of venturing back to the apartments near their schools. As a result, both parents and students are breaking leases, or simply leaving rent unpaid. Moreover, property managers that rely on students to fill their units could find that vacancies in their multifamily real estate businesses are growing and they are getting hit with early move-outs.
According to CA Ventures: “This situation is going to create a real distinction between operators who have invested in systems and technology and can do things like online leasing, and those that have not,” Bakaya says. “If you don’t have a good virtual tour or your floor plans aren’t easily available online, you’re severely disadvantaged as an operator.”
To minimize these effects, multifamily real estate businesses need to start connecting with students now to ensure that they can capture future business when the students return after COVID-19 disappears. In this respect, it’s important to start advertising to students via digital marketing campaigns ahead of future semesters.
Impacts on Traditional Multifamily Apartments
With widespread job loss and economic turndowns related to COVID-19, conventional multifamily apartment businesses are also losing residents. Solo renters and family renters may need to downsize to more affordable options, vacate their residences to live with friends and family who can support them, or they might have to stop paying their rent and need to be evicted.
Property managers need to be realistic in the understanding that if they evict tenants for late payments, new tenants may not be available to replace them. Therefore, landlords should consider cutting deals with existing renters to help them stay up-to-date on payments and keep them living in their units.
Aside from these economic considerations, conventional multifamily apartment managers may also need to make some changes to prevent viral contamination. These changes may include:
- Provide options for self-guided tours of properties to prospective tenants.
- Provide keyless entry systems and automatic doors to common areas to prevent people from touching shared surfaces.
- Reduce instances of parties and gatherings of large people by closing common spaces.
- Make changes to exercise facilities to make them safer and prevent viral spread.
Impacts from Remote Working and Social Distancing
With the reality of COVID-19, companies have embraced the concept of using remote teams and work-from-home-arrangements to help prevent the spread of the virus. Many workers who have been lucky enough to continue with their jobs from home have created make-shift offices in the corners of their apartments. While a make-shift home office could work for some tenants, others with large families may find it difficult to work productively without working space that is isolated from other family members.
As the U.S. Centers for Disease Control and Prevention has stated: “If you are sick with COVID-19, have symptoms consistent with COVID-19, or have been in close contact with someone who has COVID-19, it is important to stay home and away from other people until it is safe to be around others.” The CDC also states: “Keeping space between you and others is one of the best tools we have to avoid being exposed to this virus and slowing its spread in communities.”
As tenants continue to practice social distancing, the need and desire for larger homes or apartments are growing. Property managers may want to consider this when marketing units to prospective renters. One way to respond to the need for home offices is to redesign common areas into onsite remote working areas that offer sufficient space, isolation, and distraction-free working conditions.
In addition to the growing need for work-from-home arrangements, social distancing orders have also led to families spending more time at home – which is another reason why tenants may be seeking larger, more spacious living arrangements. Therefore, property managers may want to consider adding different perks, features, and luxuries to their apartments to make them as cozy and comfortable as possible.
How Smart Home Home Technology Can Attract Multifamily Tenants During COVID-19
One way to protect your multifamily real estate business from the negative impacts of COVID-19 is to incorporate smart home technology and smart property automation into your business strategy. Smart home technology like keyless entry, smart locks, smart thermostats, smart lighting, and free wifi are exciting perks that will attract new tenants during difficult market conditions. You can even use smart technology to offer prospective tenants the option to conduct a self-guided tour to reduce the risk of virus transmission.
If you’d like to know more about how PointCentral smart home technology and PointCentral automated property management solutions can help you reduce the negative impacts of COVID-19 on your business, contact the PointCentral team now.