The Baby Boomer generation is the description applied to those lucky individuals born between 1946 and 1964, the post-World War II period characterized by unlimited opportunities as well as peace and prosperity. Most Baby Boomers grew up in a single family house which they eagerly departed after graduating high school or college to get out on their own and rent their own first apartment. While creating their own families, embarking on their careers, and building their fortunes, Baby Boomers were the leading demographic sector affecting the rise of single home sales in the real estate market as home ownership was a priority for most of these individuals.
But now the real estate scene is changing dramatically. The apartment rental market is fast outpacing the sale of single family homes, and small apartments are one of the best real estate investments on the market today, thanks to their appeal to Baby Boomers. The year 2016 marked a milestone for Baby Boomers as they turn 70 years of age. Many of these individuals have reached retirement age and have formally ended their careers. Many are experiencing the empty nest syndrome with their own children having left home, and most are searching for the next adventure in life.
The senior population today is driving this exciting new trend in the real estate industry, as they are choosing to return to apartment living again rather than opting for a traditional retirement community or choosing to stay in their own homes. This trend is expected to keep the apartment rental market strong for the next two decades as the senior population becomes the fastest growing demographic sector in the United States. Investing in small apartments is one of the most lucrative decisions that any real estate investor can make.
The Apartment Living Advantage
Baby Boomers are discovering that a return to apartment living offers them a range of advantages that they would not enjoy if they simply moved into a senior retirement community, stayed in their current home, or opted to buy a new home in another location. Renting an apartment offers Baby Boomers the convenience of remaining flexible in their living situation.
They no longer want to commit to purchasing a single-family residence that requires them to worry about upkeep and maintenance, be responsible for furnishing a whole house, and then having to worry about eventually selling that property if it becomes too cumbersome for them to maintain. Baby Boomers who are ready to downsize their lives find apartment living offer them a new lifestyle that is unencumbered by all of the responsibilities and expenses of traditional homeownership.
Baby Boomers also like the fact that apartment living usually proves to be much cheaper than home ownership, so that frees up their retirement funds to invest in other projects.
Keeping up with the Joneses in some suburban neighborhood is no longer a priority for those in the Baby Boomer generation. And most apartment complexes that baby boomers are moving into these days offer them a range of amenities that suit their new lifestyle in retirement.
Many are located in exciting metropolitan areas with easy access to public transportation in addition to the option of walking. This means that many seniors don’t have to be burdened with the multiple expenses of automobile ownership. Renting an apartment is proving to be less expensive, more flexible and convenient, yet offering more appealing lifestyle amenities than continuing to own single family home.
Why Apartments Are Smart Investments
An increasing number of investors are investing in apartment buildings that appeal to this growing Baby Boomer crowd. Quality apartments now enjoy a large pool of tenants to choose from because not only are Baby Boomers flocking back to apartment living, those at the opposite end of the demographic spectrum, the twenty and thirty-something Millennials just starting their careers, are delaying homeownership in favor of renting an apartment. Baby Boomers and Millennials are the two largest demographic groups keeping the apartment rental market strong well into the foreseeable future, which makes investing in apartment complexes a very sound investment opportunity.
Investing in a Syndicated Apartment Building Investment through valid PPM & Documents offering from MONEIL INVESTMENT is a smart way for any investor to make a sound entry into the real estate investment market, and there is enough cash flow thanks to multiple tenants to make it affordable for MONEIL to manage the assets in-house and pay quarterly returns to investors.
The Investors invest as Class A members of the Multifamily LLC and get a preferred Return of usually 8-9% per annum and also share in the Capital Gains upon sale, usually amounting to a one-time return of 35% to 50% of their investment along with the return of the initial; by adding the two returns; it amounts to approximately 18-24% returns per annual.
Our Investors are passive investors, they are not on the loan, but they are on the title (and own a part of the Multifamily LLC). That means no calls in the middle of the night from harried tenants complaining about clogged toilets, broken water pipes, or a faulty air conditioning unit.
There are also considerable tax benefits for any investor who owns an apartment building, where the depreciation rate is taken over the course of 27.5 years. Our Property LLC passes the depreciation loss down to our investors too in their K-1s. This enables owners to take a larger tax write-off than they would be able to if they invested in single-family dwellings. Since every investment situation is different, we encourage you to make an appointment with your own tax accountant in the near future to talk about the many financial advantages associated with investing in apartment buildings.