Edited by: TJVNews.com
It seems that real estate investors across the nation are now turning their focus on areas of the country where people have moved during the Covid virus. Many people from metropolitan cities in the northeast and other areas have moved to such states as Florida and Texas to escape the Covid virus and its deleterious impact.
According to a Wall Street Journal report, these real estate investors are putting their money into apartment buildings in the South and Southwestern states where the population is steadily increasing and where rents are catapulting. The report indicated that these real estate investors expect that that these factors will keep outpacing inflation this year.
Following the patterns of employees and their employers who have moved because of the pandemic, landlords are convinced that purchasing apartment buildings could be a highly lucrative move.
The WSJ reported that such states as Florida and Texas, among others in the region boast “warm weather, business-friendly governments and laws, lower taxes and fewer regulations. They have been attracting companies and workers from California, the Northeast and other corners of the country.”
In addition, foreign investors have caught wind of the trend in moving to the South and Southwest and are “backing investments in thousands of apartments in major Sunbelt markets such as Atlanta, but also in places like Lafayette, Louisiana’s fourth-largest city, “ according to the WSJ report.
In 2021, real estate investors spent $335.3 billion into apartment buildings across the country. The WSJ reported that “nearly a quarter of it went to just four metro areas in the Sunbelt: Dallas, Atlanta, Phoenix and Houston. In some other Sunbelt cities, total multifamily investment more than doubled over the year prior, according to a report by real-estate firm CBRE Inc.”
Investors are also making quite a large amount of deals for properties that were not advertised for sale.
Speaking to the WSJ, Kip Sowden, chief executive of Dallas landlord and developer RREAF Holdings said, “We get unsolicited offers nonstop.” He told the WSJ that his company sold roughly $400 million in apartments in 2021, about 60% of which it didn’t plan to sell. Many of those buyers are from the Northeast and the West Coast, Mr. Sowden said.
Scott Rechler, the CEO of and chairman of New York’s RXR Realty told the WSJ that his company has also been purchasing off-market properties. They have invested in two apartment buildings under construction in downtown Phoenix, the company’s first deals in the Sunbelt in many years, as was reported by the WSJ. Rechler also said that “the city’s expansion of university campuses and medical facilities that attract knowledge workers, as well as new investments in transportation infrastructure, have made Phoenix an attractive bet.”