SPOILER ALERT: It sure is pretty.
By now you are certainly sick of hearing about COVID-19 and the effect it is having on every stage of the economy throughout the country and the world. By now you are also, hopefully, resigned to the fact that you simply cannot make a sound investment decision without taking it into consideration.
Nothing is quite as secure as it used to be. Those who were sure they held jobs sheltered from layoffs find themselves applying for unemployment. Those who emptied their life savings to buy that “little slice of heaven” with a white picket fence now find themselves defaulting on mortgages. But just as in nature, from the ashes often grows something even more exquisite, and in this case more functional, then what was lost.
“Renting” may never have the negative connotation it once did, and garden-style multifamily real estate may be the reason.
What is Garden-Style?
Garden-style, or vintage, apartments are multifamily buildings that tend to feature the outside more than the in. They usually aren’t more than four stories high and are surrounded by lush, landscaped grounds.
Each unit has a private entrance off of an open breezeway or shares an entrance by way of an interior hallway and stairwell that connects units immediately above and below. Most buildings feature an interior courtyard open at one end and have parking in the front or along the perimeter. You’ll need to think long and hard about big shopping trips because you’ll have to carry groceries up the stairs. In keeping with the “green” theme, most vintage real estate does not feature an elevator.
They tend to pass the eye test right away and can be seen as something of an escape, even in an urban setting.
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What Makes Garden-Style the Future of Multifamily Real Estate?
Financial Straits
A perfect storm has been swirling, at least as it applies to multifamily real estate investment. The unfortunate reality is that many who would love to own a home of their own simply cannot. Either they fear the risk of buying in uncertain times, nervous about the job they currently have, and their ability to get another if they lose it, or they have already lost income and in turn their home. Either way, cheaper monthly living expenses are at the top of the list for many. A vintage apartment with manicured landscaping and easy access to nature can ease the pain of losing that house with a big backyard.
Proximity
Gone are the days when every business felt the need to cram itself into the financial district of a major city. Big and small businesses alike are headed for places like Austin suburbs and the people are following, hot on their heels. Employees no longer have to sacrifice that ideal suburb life for a shorter commute. This is a golden opportunity for multifamily real estate investors to develop vintage property well within striking distance of major industry.
COVID Considerations
Garden-style apartments increase access to the outside, meaning more fresh air and less time in stuffy common areas. Their typical proximity to industry also may lessen the need for public transportation. And for those working remotely, the prospect of a home office just got much more attractive when your windows frame a beautiful snapshot of nature as opposed to a brick high-rise. Landlords can also take steps to easily add even more value to their property by taking extra sanitary precautions in order to make tenants feel safer.
Value
Although rent can be much cheaper than a mortgage, all of the above considerations go a long way in making vintage apartments a standard as opposed to settling. Even before COVID did its work on the economy, people were looking to have their cake and eat it too by lowering monthly expenses but still hold onto the natural space the suburbs offer. And as millennials not only continue their flight from more populous states to follow the tech industry toward Middle America, stay-at-home orders and the prospect of life as we know it changing for the foreseeable future are sending them to the suburbs as well.
The Future is Now!
Once you really boil it down, it’s not rocket science. Business is moving out of big cities and into the suburbs. Employees are following close behind, chomping at the bit to live and work in less crowded areas with plenty of room to breathe, and where they feel safer in the midst of a global pandemic. And they can even lower their monthly expenses by doing it!
Providing multifamily real estate like vintage apartments ticks all the boxes.
