- 33% of multifamily building moving to low-density markets in suburbs and exurbs, according to National Association of Home Builders
- Units for 50-plus tenants declining while single-family rentals increasing
Tenants Want Low-Density Rental Options
Just like homebuyers, tenants want out of high-density urban areas. Homebuilders are paying attention.
According to the National Association of Home Builders (NAHB), approximately one-third of multi-family building has moved to the suburbs and exurbs.
Window of Opportunity Now for 2 – 4 Unit Buildings
Robert Dietz, chief economist with the NAHB, said there is an uptick in demand for single-family build-to-rent housing. This build-to-rent market now represents a market share of 4% within single-family starts. Dietz predicts this market share to increase to 5% – 6% over the coming two to three years.
Dietz said, “There’s a window of opportunity for gains there. You do have people who want single-family structures rather than a high-rise, but they don’t have a down payment saved to own yet.”
Dietz is also predicting that the currently languid townhouse market will soon wake up from its current negligible market share to 11% to 15% over the next couple of years. He sees townhomes as medium-density housing solutions that offer middle-class prospects lower-cost housing options.
Multi-Family Design Trends for 2021
Daniel Gehman with Danielian Associates and Walter Hughes with Humphreys & Partners Architects suggested the following multi-family design and architecture trends for 2021:
- More technology to enable decreased touch points in both units and common spaces, streamlining lease processes, VR and virtual tours to expedite leasing and robots to deliver packages and groceries
- Home offices within floor plans
- Fusing indoor and outdoor spaces, improved ventilation systems and pods for smaller-sized gatherings (6 to 8 people) rather than expansive clubhouses to accommodate big gatherings
- Greater eco-friendly and sustainable materials for greater solar use, water-saving features, cleaner air and recycling-compost programs
Top 10 Markets for Multi-Family Permit Growth
- Jackson MS
- Mankato-North Mankato MN
- Vernon-Anacortes WA
- Abilene TX
- Yuma AZ
- Beaumont-Port Arthur TX
- Dubuque IO
- Topeka KS
- Columbia MO
- Brownsville-Harlingen TX
Thanks to National Association of Home Builders and REALTOR® Magazine.