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Who Says the Rental Property Boom Is Over?

If you’re in the residential property business, either as an investor, developer or a property manager, you’re in a good place to be, and likely to stay there for many more years.

“Millennials and their parents and grandparents are driving growth trends in the rental market.”

Both millennials at the young end and their parents and grandparents are driving growth trends in the rental market.

Those are two of the eight rental property predictions for 2015 recently posted by Norada, a real estate investment research company, which expects apartment demand to stay strong well beyond next year.

The aversion to home ownership of many millennials and Generation Y is well known.  Many of them saw their parents, neighbors and friends’ parents lose their homes during the Great Recession, “so what used to be a middle-class rite of passage is now perceived as a risky endeavor,” validated by a volatile employment market and the difficulty in obtaining financing.

“We’ll see some pent up demand for homeownership make itself felt at some point,” Norada says. “But it could be years before we see today’s millennials leave their rental units behind and make a big demographic-scale shift to homeownership.”

A recent survey from Freddie Mac, which has a vested interest in home ownership, found that the majority of renters are still struggling financially and plan to remain renters for at least the next three years.

“Many renters are not buying homes because of a perceived lack of ability to afford the down payment or mortgage and poor credit history,” said David Brickman, executive vice president of Freddie Mac Multifamily. “But there also is a segment of renters who simply do not want the responsibilities of owning a home.”

But the rental boom is also being driven by millenials’ parents and grandparents. Baby boomers, many of them now empty nesters, are migrating to rentals at the rate of 200,000 households a year, according to Multi-family Executive Magazine.

rental property boom
The renal boom is being driven by people from various generations.

What’s driving this trend at the other end of the age spectrum? Lifestyle choices (i.e., no more mowing the lawn), foreclosures and divorce. These trends will last far beyond 2015. The Joint Center for Housing Studies at Harvard University is projecting that by 2023, half of the growth in renters will come from those 65 and older.

This means that rental property investors, developers and property managers have lots of opportunities ahead. And that’s certainly terrific news. But to take optimum advantage you’re going to need a system to help you manage it.

One of the biggest complaints we hear from developers is how frustrating it is to manage projects from separate systems and applications, or trying to make a system designed for contractors fit your unique needs. This leads to serious inefficiencies resulting in wasted time, increased errors and slow financial processing.

That’s why Budgetrac was developed. It’s the only software on the market specifically designed for commercial and residential real estate development businesses. It eliminates the need for stand-alone applications and external spreadsheets, which lead to inefficient and inaccurate data collection. The right software can have a significant positive impact on your development company immediately.

Let’s say you’re a home builder who wants to add property management operations, or a commercial developer exploring multifamily construction and management, or a property manager needing to control cost on a new development or major capital improvement project. Budgetrac can handle all those tasks with one integrated solution.

Budgetrac can forecast the estimated cost to complete a project at any point in its life cycle. It manages all phases of your development operations from inception to completion, including project predevelopment, land development, vertical construction, property management, tenant improvements, lender funding and tenant billings.

And you’re not just buying software out of box. To ensure you get the most from your Budgetrac system, our real estate development specialists consult with you to build and implement the perfect solution for your business to deliver maximum efficiency, profitability and performance, then stay committed to your success with expert training – either virtual or on-site – supported by a world‐class, real-time back office team.

With its intuitive design, flexible functionality and robust financial and reporting tools, thousands of real estate developers trust Budgetrac to help them compete and thrive in today’s fierce real estate market.  It’s easy to use, yet powerful enough to handle all of your operations in one system.

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