Resident Experts with Jay Lybik
As part of our ongoing Resident Experts series, Entrata recently hosted Jay Lybik, Director of Multifamily Analytics at CoStar. Jay has nearly three decades of experience in commercial real estate research, with a majority of that time spent in the multifamily sector.
Jay was joined by Virginia Love, Industry Principal at Entrata for a wide-ranging conversation about the current state of the multifamily industry and where they see it going after a few volatile years. You can watch their entire conversation here. Below are some of the key highlights of the webinar.
Demand currently not meeting supply–especially at the top
The market is experiencing a record number of units being delivered, but demand is down from the record levels we saw in 2021, especially at the top of the market where a vast majority of the new supply is coming from. However, there is still a need for additional inventory in the middle, and low ends of the market.
“I'm keeping a really close eye on what's going on at the different price points, because the supply issue is really, really focused at the top end of the market,” said Lybik. “In the middle of the market, we're experiencing so much economic uncertainty and issues with high inflation and households being able to afford rent. We’re seeing operational problems in the middle of the market that have nothing to do with the supply issues at the top.”
Forecasting future demand continues to be difficult
We are living in unprecedented times, which makes it difficult to forecast future demand, and a lot of this goes back to lifestyle changes that came about as a result of the pandemic. Most notably, residents no longer have to live near their place of employment. This means one of the better indicators of demand, job creation in a particular market, isn’t as accurate as it has been in the past.
“The problem going forward is if you work for a company headquartered in San Francisco and they then say you could work anywhere and you move to Boise, Idaho, technically, they're supposed to report to the government that you live in Boise, Idaho,” noted Lybik. “Whether they're doing that or not, we don't know. And so it makes the employment data right now, not as rock solid as it used to be.”
With all this being said, Lybik was optimistic about the remainder of the year because of how positive things were in the second quarter, which has been an indicator for how the rest of the year will play out.
Your online presence is more important than ever
If you want people to come to your properties and take a tour, there's a lot of boxes you need to check to get them to show up. Do you have up-to-date listings published? Do you have an attractive website that is easy to navigate? Do you have an engaging presence on social media? Do you have a positive online reputation? If you can’t answer yes to all of these questions, there’s a good chance you’re missing out on prospects before they even engage with your properties.
Today’s prospect wants flexibility, convenience, and transparency. Part of that is providing them with everything they need to know, all in one place, with as little friction as possible when searching for an apartment and signing a lease. Beyond that, it helps ensure there are no surprises after the lease is signed, in the form of extra fees for things like parking or package room fees.
Multifamily businesses that put that extra effort into simplifying the renters journey will likely see it pay off in the form of increased lead numbers and higher conversion to leases.