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Posted by on in Multifamily Industry News and Trends
As most renters and apartment owners will testify, good apartments are harder to find and today’s rents are well above levels of just a few years ago. Lots of reasons for this – both increased demand and limited supply. On the demand side, former homeowners who lost their homes to foreclosure or damaged their credit during the downturn are now renting. Millennials who desire mobility, have high student loan balances or don’t have sufficient down payments are also competing for apartments. Supply is tight because very few apartments were built from 2007-2012 and the cranes in the sky in hip and cool cities nationwide today are basically catching up to the shortfall created during that five-year period. Limited availability of well-located land, entitlement challenges, NIMBYism, shortages of construction labor, escalating lumber and material prices also pinch supply. As a result, practically the only apartments being built are class-A, luxury properties – and many folks can’t afford those. So what’s a tenant and an apartment investor to do – and what does it bode for the future of apartments? Think ATT – affordability, transportation and technology. As people on a limited budget know, when the money runs out near the end of the month, tuna fish, peanut butter and mac & cheese may be on the menu for days on end. For penny-pinching apartment dwellers, affordability might mean a longer commute, a smaller pad or doubling up with a roommate. Apartment developers know that trees don’t grow to the sky and 3-7%...

Posted by on in Multifamily Industry News and Trends
Today, multifamily housing investors look for renovation ideas that offer them optimal utilization of available space within their budget. Whether you own a property in Scottsdale or nearby counties, a professional renovation contractor can help you augment the exteriors and interiors of your home aligned with your business objectives. As every year multifamily industry witnesses change in home remodeling and designing trends, 2017 is no different. Continuing the discussion further, we take a look at some popular multifamily renovation trends to watch for in 2017.Wide-open SpacesWe all need our personal space, so why not have some space for your occupants? Multifamily property owners undertaking renovation or remodelling projects are providing spacious rooms or wide-open spaces such as balcony in every apartment. Hiring a professional remodeling and design company can help you ensure maximum utilization of your property while ensuring enough space for free movement within the unit.Granite DecorationsContemporary renters look for affordable multifamily housing unit that offer them luxury without breaking the bank. This is why decorating multifamily rental units can never be out of trend. It can only evolve. Granite has always been a popular choice for flooring, but today it has slowly cropped its way to countertops, table tops, and even clocks. When undertaking a renovation project, multifamily property owners should look at granite more than just a flooring option.Bold and Unique ColorsMultifamily property owners are now getting more experimental than ever. They are experimenting with bold and unique color combinations to make their property stand away from the...

Posted by on in Multifamily Industry News and Trends
The confirmation of Dr. Ben Carson for the role of Secretary of HUD has created quite a stir both in real estate finance circles as well as the general public. Though we are still taking a "wait and see" approach to the new administration and HUD's FY 2018 budget, we are optimistic about the future of HUD's loan insurance programs for market-rate and affordable multifamily housing, healthcare and hospitals. Here are a few reasons why: In a pointed question from Senator Bob Menendez about the part that FHA plays in providing affordable rental housing, Dr. Carson called the agency's role "very important." Specifically, he cited the 221(d)(4) program, which insures loans taken out to build or rehabilitate apartment projects, as one of the "best resources we have in this space." He furthered this point in discussing how the program, in combination with low-income housing tax credits, is "creating affordable units across America"  Dr. Carson is keenly aware that much can be done to make his agency more effective, recognizing that developers need more predictability from the agency, along with better customer service  A recently leaked draft of proposed changes to HUD's FY 2018 budget caused a frenzy; however, that preliminary version will undergo significant changes before it's ready for the public. Even its current form, the proposed budget will not negatively impact Love Funding's ability to provide FHA-insured financing While the preliminary budget does propose a 5% reduction in salaries and administration at HUD, the Multifamily group is well positioned to...

Posted by on in Multifamily Industry News and Trends
Multifamily construction and rehabilitation sometimes involve the use of various chemicals and other elements that are hazardous to the environment. These chemicals not only affect the indoor air quality and immediate occupants of the building, the fumes can travel through the vents of air conditioning system to affect the surroundings of the building under renovation. Whether the rehabilitation is for interior or exterior of the multifamily housing project, it is imperative for the rehabilitation contractor to exercise control strategies to reduce the effect of harmful toxins in the environment. Read this post to learn about four of those strategies.1. Substitute the ContaminantThe rehabilitation contractor needs to identify the source of contamination and try to find a less harmful substitute. You may, for instance, replace oil based paint with latex, solvent-based adhesives with water-based adhesives, and choose low formaldehyde emitting fabrics, and continuous filament carpet.2. Encapsulate the Source of FumesCreating a barrier around the source of fumes could help in isolating them to a certain unused area of the building. Another factor you need to ensure is that there is no recirculation of air from the encapsulated area into occupied spaces. Contractors can physically isolate a section of the building with polyethylene sheeting and other barriers or restrict the fumes to enter the general ventilation system by blocking return air grilles. 3. Provide Proper VentilationContractors can combine encapsulation techniques with ventilation dilution techniques to increase the amount of outside air passing through an area, and dilute and flush out low levels of...

Posted by on in Multifamily Industry News and Trends
We all know about how the winter holidays always lead to a profound uptick in the number of packages your residents are receiving. But as ecommerce continues to rise exponentially, there are so many other times throughout the year when package delivery may surge at your properties. Check out our list of “Top 10 Hidden Holidays” you need to be prepared for: Super Bowl Sunday. Once your team is out, you frantically buy gear for your de facto team of choice (let’s just say my son now owns a Falcons sweatshirt). Besides, how else are you going to get all football themes napkins, bowls, plates, etc. the Super Bowl Party?! 100th Day of School. Yes, this is a thing and not something we made up. It’s mostly celebrated by younger students sometime in February, as schools have fun with the number 100. Many Pinterest-loving mothers are known to order craft items at this time, which can lead to a sneaky increase of packages in some circles. Valentine’s Day. That oversized Vermont Teddy Bear isn’t going to drive itself to your significant other’s home. And neither is that sparkling necklace or whatever else you’ve ordered to make sure you’re not the goat on the international day of love. Memorial Day. Everyone wants to get away for Memorial Day. But it’s even better to leave town with that new tent, new fishing supplies, new tarps and other camping accessories. Late May always leads to a package boom. Independence Day. Yes, it’s illegal to ship fireworks by mail, so we’re...

Posted by on in Multifamily Industry News and Trends
Sheri Killingsworth, Vice President of Marketing and Communications with Lincoln, was kind enough to share her thoughts recently on how this industry giant goes about creating a sense of community with residents. A 17-year veteran of the company, Sheri began on site, working her way through the ranks into the corporate office.     According to Sheri, to talk about anything Lincoln you have to start where they do when it comes to residents: ‘Where comfort meets convenience you find home.’   “Here at Lincoln, we talk about the three key places; work, home, and the third place. That’s the place that isn’t home or work, a place where you feel welcome and at ease. It’s a place where you can have a change of environment to get some work done, hang out with friends, or be around other people…and not be so alone,” says Killingsworth. “We want our residents to be able to activate our amenity areas and program it as if it’s their own space.”  As you might expect, Lincoln also engages residents in a robust calendar of events “customized to each community and based on who the residents are.” From Stroller Saturdays for new moms, to Wine-down Wednesdays for those needing a mid-week break, getting residents to come together and connect is part of the Lincoln way.  It’s obvious that culture plays an enormous role both within Lincoln and with their residents. “Our culture truly follows our tagline, we are a company for people and about people,” Killingsworth offered, “Everything...

Posted by on in Multifamily Industry News and Trends
b2ap3_thumbnail_cfaa.pngYesterday afternoon, Finance Minister Bill Morneau tabled his long-awaited second budget. CFAA is relieved to report that, despite rumblings about an increase in the capital gains inclusion rate, there were no changes to how capital gains are treated.   Taxes – No increase in the capital gains inclusion rate Despite the rumours that have been swirling around in business circles, Budget 2017 did not make any changes to the capital gains inclusion rate (CGIR). That rate is extremely important for rental investors of all sizes. The CGIR is currently 50%. Of a capital gain on the sale of a rental property of $100,000, $50,000 is taken into income and taxed at a person’s tax rates. During 2016, the government reviewed various tax credits and tax expenditures, especially those which disproportionately benefit the highest income earners, that is, those with annual incomes above $200,000. While the review took place in great secrecy, CFAA communicated to key people in government that an increase in the capital gains inclusion rate would be disastrous for rental housing supply, for the economy, and for tenants. In large part, an increased capital gains inclusion rate on rental housing would be an increased tax on the poor, exactly contrary to the government’s goal of making housing more affordable. (As usual, the main way to success is to address issues that the government cares about, rather than the pain which landlords and other asset owners would suffer.) CFAA’s submission is posted at www.CFAA-FCAPI.org/submissions.php.  Other tax planning issues Budget 2017 promised a paper in the coming months on several tax planning strategies, including: Sprinkling...

Posted by on in Multifamily Industry News and Trends
  As the preferences of residents in urban areas continue to gravitate toward newer, hip forms of public transportation, apartment owners should be watching eagerly.    Fewer and fewer residents in high-density areas are opting to own cars, causing them to place a higher priority on car-share and ride-share services than on parking. Initially, downtown communities might have met this trend with disdain, wondering what they were going to do with all those extra parking spots.     But the concept that spurred this trend – the sharing economy – is also the answer of how to address it. Those empty spots serve as an ancillary income opportunity that can not only generate additional monthly revenue, but add overall value to the community. While residents opt for alternative forms of transportation, you can fill those increasingly vacant spots by utilizing a park-share concept.   Even though some of your residents might not park at your community because they don’t have a vehicle, spaces are still at high demand for those who commute to the area for work or entertainment.   A look at a study by the National Multifamily Housing Council on Urban vs. Suburban Housing Preferences reveals a clear picture of the disparity of resident preferences. While parking is a primary interest for close to 95 percent of residents in areas with household densities in the 94th percentile or less, the number declines in markets at the top end of the scale. In turn, interest in bike-share and car-share programs...

Posted by on in Multifamily Industry News and Trends
Dear Gabby,  I’ve been hearing more and more about this “All-Inclusive Living” trend as of late. All I can think about when I hear the words “all-inclusive” is a resort where people are lazy, being waited on hand and foot without paying extra. I’m sure there is something more to it since it is becoming more popular but can you explain?   -#ALoyalOfficeFan _________________________________________________________________________ Dear #ALoyalOfficeFan,   Gabby here! And I am going to help you understand all of the details to the new “All-Inclusive Living” trend! It’s less about being lazy and more about residents being busy. They want convenience built into their lives by having everything they need included in their multifamily community.  It’s becoming more and more common for American workers to work long hours. A lot of companies have meals, coffee, nap rooms, employee outings all provided at workplaces such as Google, Yelp, and more! People with this lifestyle are used to having everything in one place and want those conveniences to continue once they come home.  Work life balance is always important when it comes to looking for jobs but what if that balance is becoming more about making work feel like home and home feeling like a hotel. “All Inclusive Living” helps make this balance possible.   Okay, so are some examples of what could be included in “All Inclusive Living”?   Fully Furnished Apartment This one isn’t a new option but space-saving transformable furniture is. With this new furniture, residents can have smaller rooms...

Posted by on in Multifamily Industry News and Trends
We all know that great resident retention depends largely on factors like timely maintenance response, friendly staff, unique amenities and beautiful curb appeal. But how much thought is given to the importance of social connectedness relative to resident satisfaction and renewal rates? There is a great deal of evidence of late on the impact of being socially connected (or not) on physical health and psychological well-being. You can read an outstanding article on the subject citing several related studies here. Witten Advisors presented some interesting industry data on connectedness at the recent NMHC Annual Meeting in a session titled "Hanging onto Residents by Cultivating Real Community and Relationships." Take a look at the following graphs:     Surprising, no? Such a small percentage of residents have more than a couple of friends within the community, and the majority have none. And yet, look at the correlation of number of friends to intent to renew! It seems like a no-brainer that efforts to increase social connectedness among residents are well worth the investment, time and energy. All those great activities you spend hours planning are so very worth it! Anything you can do enhance or facilitate interaction between your residents will pay off in a big way; community apps and portals that make it easy for residents to communicate with you and each other, a consistent and creative schedule of events designed to get people talking and playing together, pet play dates and sitting connections, carpool-to-work opportunities, book clubs and bulletin boards...