Multifamily Flashcards
___ is defined as 5 or more units in a building or group of buildings - 18,700,000+ units in the US
Multifamily
Multifamily comprises _% of all rental housing.
43
Multifamily investments are favored by investors due to:
(4 points)
- Attractive total returns
- Consistent, long-term income
- Considered to be relatively safe investment with modest risk
- Diversification of investment portfolio due to low correlation with other asset classes
Multifamily classifications: Class _ are in prime locations that are urban or urbanized suburban with higher density. They’re new or recently renovated and construction is usually midrise or high-rise.
A
Multifamily classifications: Class _ are in stronger sub-markets, often suburban or secondary markets. They’re garden or townhouse style and are newer (not more than 15-20 years) or renovated. Considered today as Workforce Housing.
B
Multifamily classifications: Class _ are in secondary or tertiary markets or locations. They’re older (20+ years) and not recently renovated. They’re garden or townhouse style with little to no amenities and are just considered “affordable”.
C
Multifamily classifications: ___ include government subsidized housing (Section 8), tax deals (Low Income Housing Tax Credit - LIHTC), or Private/Public Partnerships (PPP).
Low Income Housing
Housing affordability is gauged against ___ of an area.
Average Median Income (AMI)
Luxury renters earn _% of AMI.
100-120
Workforce housing rents for those who earn _% of AMI
80-100
Affordable rents for those who earn _% of AMI
60-80
Low income properties are reserved for those who earn _% of AMI
60 or below
___ during the Global Financial Crisis put a serious strain on housing affordability.
Lack of unit starts
_% of the US population lives in rental housing
37
