A few months ago, we wrote an article highlighting the deals that could be had in big cities, particularly in the multi-family sector. The reason for this was because over the past 10+ months, we have seen an exodus from big city living in favor of suburban living. In places such as New York, San Francisco, Chicago and Boston, some rental buildings went from full occupancy to 50% vacant as remote work and school enabled residents to move to less congested areas. Of course, the primary driver for this has been the pandemic and desire for more space to promote social distancing.
As the year turned to 2021, we now have two approved COVID-19 vaccines and thus more hope on the horizon. This is already being felt in big city real estate markets. For example, the Greater Boston Association of Realtors® reports that sales of single-family homes and condos in the city hit a record level in October.
In the end, certain people are simply “city people”. As the COVID-19 vaccine distributions continues to reach more and more people, this will increase the confidence of city dwellers. Although we expect the remote working environment to be adopted permanently by many companies, we foresee more city dwellers returning to the life they covet during 2021. Therefore, we should expect to see a rebound in multi-family rental prices in metropolitan areas during the second half of the year.