Today’s renters are more discerning than ever. Environmentally conscious millennials, GenXers who need flexible space with room for multiple generations, and Baby Boomers tired of clutter, all have specific needs in mind when seeking their next “home sweet home.”
If you’re investing in ground-up multifamily construction, it’s easy to modify floor plans to reflect the latest trends in apartment design. But you can also incorporate these highly desirable characteristics into your existing investments as well with a well-planned renovation and rehab strategy.
The best parts of these trends that can help ensure the success of your real estate investing initiatives? They are more than passing fads, but time-tested solutions to make today’s multifamily properties more practical and livable for every generation.
1. Open, Flexible Floor Plans Accommodate the Changing Needs of Today’s Families
According to real estate services firm JLL, more than 40% of all real estate investment dollars raised in 2017 by private equity funds were raised for value-added investments. Even partial renovations like reworking existing multifamily properties to appeal more toward the desire of today’s renters for flexibility to gather and entertain can add major appeal.
A kitchen with an island overlooking a family room and a dining room to the side makes for easy entertainment and helps everyone feel closer. Open floor plans also make smaller apartments feel bigger. Pocket doors and other movable partitions can instantly transform a space, creating a partition between the family room and the dining room as needed.
2. Handicap Accessible Features That Blend with the Architecture Combine Form and Function
In 2015, 34.5 million Americans provided unpaid care to someone over 50. That number has only risen as the Baby Boomer cohort continues to age. In fact, 66 million Americans today consider themselves “caregivers.”
Adding accessible features to an apartment can make a rental more desirable to caregivers, older adults, and even families with young children. But “accessible” doesn’t mean you have to go through the expense of adding a chair lift to the stairs or a seat in the shower. These additions can be customized as needed by individual buyers.
Instead, embrace what architects call “universal design” to make rental units easier to navigate in your next real estate endeavor. Wide hallways, handrails on stairs, solid wood floors with no saddles between the rooms, and–once again–open floor plans blend in with a property’s architecture while making it friendly to multigenerational families.
3. Green Construction Creates Healthier Spaces
The drive to create safer living spaces complements the trend of green, clean and healthy lifestyles. It’s easy to adopt eco-friendly, healthy construction methods in a new ground-up multifamily construction project. Take an active role in learning about the building products being used, and try to avoid synthetic materials, toxic, fume-producing glues, plastics, and laminates wherever possible. Look into reclaimed wood and environmentally friendly insulation. In addition, large, south-facing windows that let in natural light are eco-friendly, while reducing heating and lighting costs.
When renovating older apartment buildings, see how many of the natural building materials, such as solid wood, you can keep or repurpose. Choose no-VOC paints, recycled glass, formaldehyde-free cabinets, and bamboo floors to renovate a multifamily property in ways that are healthy for the environment and the residents. Adding smart thermostats, lighting, and appliances are affordable ways to make a rental more eco-friendly and appealing to buyers.
4. Municipal Public Use Facilities in Common Areas Help Investors Take Advantage of Tax Abatement
Location is key—and investing in the right areas can help reduce your operating costs through tax abatement. Some cities and municipalities offer tax breaks for introducing multifamily homes into mixed-use commercial buildings or for certain property improvements in areas undergoing revitalization. Your investment may also qualify for tax abatement if you convert a common area into something the whole community can enjoy, such as a performing arts center, youth center, or senior day care.
Trends, or Time-tested Solutions?
These multifamily building and remodeling trends all follow a common theme: They have evolved to satisfy the needs of ever-changing families and reflect the values of today’s renters.
As a result, incorporating these ideas is less about following the latest architectural trends, which may come and go, and more about embracing time-tested solutions to make life easier for potential tenants and their families.
From an investor’s point of view, finding creative ways to implement these solutions can result in higher rental prices without a substantial increase in building or reno costs.
Ready to take your multifamily property investments to the next level?
Turn to 5arch for the funding you need to Borrow Better℠ and maximize your profits.
5 Arch Funding Corp. (5arch) is a nationwide direct lender serving brokers, correspondents, and real estate investors. We help clients navigate the complexities of the market by empowering them to make more intelligent lending choices with our innovative products and powerful advisory service so they can Borrow Better.℠5arch makes and acquires business purpose loans only and does not originate or acquire owner occupied residential mortgage loans. 5arch does not provide tax, legal or investment advice. The information provided herein is informational only and does not constitute tax, legal or investment advice. You should consult your own tax, legal and investment advisors before entering into any transaction. 5 Arch Funding Corp./NMLS ID # 1039184. 19800 MacArthur Blvd., Ste. 1150, Irvine, CA 92612; Arizona Mortgage Broker License # 0933148; Oregon Mortgage Lending License Number ML-5475; CA Bur of Real Estate – Real Estate Broker Corporation License #01928500; California loans made or arranged pursuant to a California Finance Lenders Law License, # 603K373. 5 Arch Funding Corp. makes first lien mortgage loans. In certain states, 5 Arch Funding Corp. only lends to entities. In Nevada, loans are available through 5 Arch Funding Corp.’s business partners; 5 Arch Funding Corp. does not make or arrange loans in Nevada.
Michael Miller serves as the Chief Marketing Officer of 5arch and is also one of its principals. His past experience included positions as CMO of Epsilon Agency Services and managing director of Catapult Marketing. He also co-founded Hyper Marketing, which was later acquired by Epsilon. Miller has developed global marketing platforms across numerous brands, including JPMorgan Chase, Union Bank, Wells Fargo, Google, Intel, GM, The Home Depot, Lennar, and Tishman Speyer.