3 Residential Real Estate Investment Trends to Watch in 2023
As the real estate market continues to evolve, staying ahead of the trends is crucial for investors who want to make informed decisions and capitalize on lucrative opportunities.
In 2023, the residential real estate sector is already experiencing significant growth and transformation. To stay ahead of the ever-changing real estate investment landscape, keep reading for three key investment trends that will shape the market this year.
Trend #1: Continued Growth of Build-to-Rent
Due to increasing interest rates and a greater tendency to embrace a remote lifestyle post-pandemic, there is a growing segment of affluent renters.
These high earners are not ready to buy, but they do still expect updated designs, energy-efficient features, and smart home technologies that are not easily found in older homes. This, coupled with a limited housing supply, presents a lucrative opportunity for build-to-rent investment properties.
While these projects can present challenges such as higher upfront costs, real estate investors can get ground up construction loans through Temple View Capital with progressive advanced rates on construction projects.
Trend #2: Technology Integration
The pandemic also accelerated the adoption of technological advancements in real estate that are here to stay, thanks to their ability to enhance both the investor and tenant experience.
One example of these includes property management software such as Appfolio and Buildium, which automate various tasks like rent collection, maintenance requests, and financial reporting.
Furthermore, virtual reality (VR) and 3D visualization tools have gained popularity, enabling investors to show properties remotely and prospective tenants to take virtual tours. Companies like Matterport and Realync offer immersive experiences, allowing potential tenants to explore properties from the comfort of their homes. This technology saves time and resources while attracting a wider audience of prospective renters.
And as mentioned above, renters have greater expectations for automation and iOT (internet of things) capabilities like smart locks, thermostats, and security systems. Not only will these features please your tenants - they also allow you to increase your rental prices.
Trend #3: Turning a Single-Family Home into Multi-Family Housing
The demand for multi-family housing is on the rise, driven by factors such as changing demographics, evolving lifestyles, and affordability considerations. Of course, obtaining a multi-family property can be challenging. That’s why turning a single-family home into a duplex or triplex is becoming more and more popular with investors.
By creating multiple income streams from a single property, you are not only minimizing your risk - you’re maximizing your returns. Let’s say, for instance, that you have a triplex. If one unit is vacant, you still have the others who are paying rent and keeping the revenue stream flowing.
Additionally, in the same situation, you have the ability to diversify your portfolio. Two of the three units could be set up for long-term rentals with the other being a short-term rental. That way, you have the flexibility to take advantage of the fluctuations in the marketplace.
Multi-family homes can also produce greater equity than a single-family home, providing real estate investors with the ability to leverage the property as capital to further grow their real estate investment portfolio.
Drive Cutting-Edge Advancements with Trusted Allies
In the ever-changing real estate landscape, it’s challenging to stay ahead of the curve. That’s why it helps to have reliable partners like Temple View Capital. When unique opportunities arise in the marketplace, TVC’s experienced team can help you get the resources and funding you need to grow your investing business. Start a conversation with Temple View Capital today, and unlock the full potential of your residential real estate investments in 2023.