Another common question that our clients have had over the years is “how does apartment construction affect housing?”, this is a great question to ask because over the last 12 to 18 months there’s been a lot of new apartment construction across Southern California, especially in Orange County where companies like the Irvine Company have been building more apartment buildings.
It’s All about Growth
There’s no denying that having more apartments, condos and townhomes is a good thing for renters across Southern California since this also gives them more rental opportunities to choose from but an increase in rental construction is also a good thing because it’s a sign that the Southern California population is growing and more people are migrating here.
Courting the Millennials
Even though some people may not be excited about having more rental properties available in SoCal, it does serve a purpose, especially for the Millennial generation (18 to 34 year olds) who have been less inclined to buy homes and have continued renting, or living with their parents, in spite of rock-bottom mortgage interest rates and great home prices over the last two years.
Long Term Impact
When it comes to long-term home values we could see home prices in Southern California drop in the coming years since there may be fewer home buyers than right now but ultimately having more long term rentals in the form of apartments, condos and townhomes to choose from in Southern California is a good thing since Millennials and other home buyers who are renting in SoCal may be ready to transition to buying and when they are ready to buy it may not be a competitive sellers market like it is now.
To learn more about apartment construction in Southern California, or to view homes for sale, contact Fred Sed Realty today by calling us at (800) 921-9231 or connect with us online.