While 2020 can still lay claim to the most chaotic year the apartment industry (and perhaps everybody else) has ever experienced, we didn’t exactly get back to business-as-usual in 2021.
Sure, some semblance of normalcy returned, but 2021 also was a year of continued adjustments, ever-changing protocols, and prolonged staff shortages—all while the industry continued to push the envelope from a technology perspective.
Here is a look at some of the major multifamily storylines from the year:
Rental rates return to normal and even begin to grow.
While rents predictably remained flat and even decreased in 2020, rent growth reappeared in 2021 as the world largely got back to work. While growth varies by locale and is impacted by a variety of factors, a recent Zumper report indicated that rents for the average one-bedroom apartment home increased by 12.1% and the average two-bedroom unit by 13.2% through the first 11 months of 2021. Granted, the significant increase also includes a bounce-back effect from the interrupted potential growth of 2020.
AI and automation play a larger role.
Unfortunately, multifamily wasn’t immune to the nationwide labor shortage. Thankfully, innovations were in place to help the industry compensate. Artificial intelligence and automation helped handle a variety of leasing and marketing tasks—from simplifying the application process to streamlining prospect communication—enabling constricted onsite teams to focus on higher level tasks. Chatbots continued to evolve, as well, with advanced natural language processing enabling them to more accurately understand and answer a prospect’s questions.
Emerging tour types
After the hurried onboarding of various touch-less tour types at the outset of the pandemic, many in the industry were curious to see which would remain in play in the aftermath. The answer is that all of them have some degree of staying power—but not everywhere. Self-guided tours remain the most popular, particularly in high-foot-traffic locations. Suburban communities, meanwhile, often favor prerecorded video tours that can be messaged or emailed to the prospects and offer QR scanning at the door. Entrata data shows that traditional tours made a comeback in the summer, as guided tours increased from 47% of all tours to 57% from April to July. Self-guided tours decreased from 46% to 32% in that same period but figure to remain a prominent option moving forward.
Single-family rentals become the hot trend
While single-family rentals are nothing new, the trend of multifamily investors and operators entering the sector certainly is. Some suggest the pandemic-fueled tendency of renters to flee urban cores for suburban markets—at least for the short-term—alerted multifamily professionals to the opportunities in these secondary and tertiary markets. Entrata’s Chase Harrington recently moderated an OPTECH session dedicated to the topic.
Advanced account verification tools
One of the primary loopholes used by non-qualified applicants to qualify for an apartment home is fabricated bank information. But even when good-intentioned prospects apply, it can take several days to verify funds. In an instant-gratification world, real-time answers can swiftly move along the leasing process at a modern-day pace. Verification tools became further advanced in 2021 to help instantly authenticate bank account information, which helps weed out any potential fraudsters while allowing good renters to move through the application process more quickly.
The return of industry conferences
While most conferences were relegated to a virtual format in 2020, some major industry events such as Apartmentalize (Chicago) and the National Multifamily Housing Council’s OPTECH conference (National Harbor, Md.) returned in person—albeit in distanced fashion with mask mandates.
While 2021 certainly wasn’t as otherworldly as its predecessor, it took on an identity of its own as the apartment world continues to move forward and evolve.