As you already know, one of our favorite commercial investment asset class is multifamily dwellings, but today we are going to talk about why we like it so much.
We specialize in representing sellers and buyers with apartment buildings in South Florida, specifically Miami-Dade County; which happens to be one of the hottest markets in the country.
Here are some facts…
Florida is currently the 3rd populous state in the country, ahead of New York.
Florida’s population is growing and fast.
15,982,000 in 2000
18,801,000 in 2010
20,273,000 in 2015
Forecasted to grow to over 23 million by 2030.
Over the last five years, South Florida was the 6th fastest-growing metropolitan area in the U.S. with over 361,000 new residents. Growth expected to remain for the next 5 years.
Approximately, 70% of new arrivals are from overseas. Many of these new residents will enter the rental pool. For the fourth year in a row rents were at record levels in South Florida. In 2016, rents increased by 5.8%, 7.0%, and 7.8% in Miami-Dade, Broward, and Palm Beach County respectively.
Just Miami-Dade County alone has a population of over 2,700,000, making it the most populous county in Florida. Annual Domestic In-Migrants (people coming from other states) over 65,000. Over 150 people arrive a day from another country. Keep in mind this is just for Miami-Dade County.
Just think about all those companies that have transfered their headquarters in the last few years to Miami from other states. Some of the reason why these companies have been relocated to Florida is because state tax benefits or because the convenience of proximity to trade with Latin American countries. You have to remember that once a family is relocated, one single household can have a minimum of three to four members. Sometimes as the relocated immediate family starts to establish their new life here, other distant family members start joining them.
Now think about the amount of people retiring in the sunshine state. Between 2010 and 2040, Florida’s older population is expected to almost double. The 75-79, 80-84, and 85+ age groups will more than double over this time horizon. Population aged 75 and over currently represents about one-third of the 65 and over age group and is expected to increase to slightly over half of that by 2040.
Miami is the third least affordable metro area in the U.S. for renters. (Over 45% of house hold income)
So, you might want to ask yourself… Why not be in an industry where 45% of a household’s income goes to? People need a safe, clean and affordable place to live, why not provide that?
If you are going to invest in real estate, apartment buildings provide the convenience of collecting several rents from the same location and instead of having several single-family homes, you can have multiple units under the same roof. The fact that you can create your own policies and procedures, means you can accept or deny any tenant you want, of course, as long as you comply with Florida Statutes. In the case of renovations, you don’t have to wait for any association’s approval.
If you are looking to learn more about investing in multifamily buildings or you are considering in selling your apartment building, please feel free to contact us, it will be our pleasure to assist you.
Your Trajan Investment Team – Assisting Commercial Real Estate Investors to Prosper!
Trajan Investments, Inc. A Commercial Real Estate Brokerage and Consulting Firm.