In 2023, we are entering a post-Covid era and there will be significant challenges for property managers. Property managers and landlords have faced delays in rent payments, debt issues, staffing issues, inflation, higher operating costs, and additional regulations. Preparing for 2023 will be a huge benefit for property managers–but first we need to understand the trends.
Overall, the property management industry is one of the healthiest sectors in the business industry. Profits and cost reduction will remain to be very important this coming year and this will be supported by growing demand in rental properties. The cost of doing business due to inflation is a major concern, while wages will also remain high.
In 2022, it was found out in a survey that many renters today are seriously threatened by the economic impact of COVID-19. With competitive market indicating a stable rise of rental prices in many cities of the United States, despite seeing a low supply of housing in 2022, new renters may face difficulties in finding inexpensive units to occupy as many owners may sell (or have already sold) their properties to recover from the losses resulting from government lockdowns and restrictions. In short, the COVID crisis has resulted in higher demands for rentals.
The result shows that almost half of the renters surveyed struggled to cope with their rental responsibility when COVID started. This means that many renters in America were seriously impacted by the pandemic. Since the beginning of 2020, these renters are missing their rent obligation and some even found themselves in a very difficult situation where they cannot afford to continue renting anymore. This negative impact which resulted in widespread eviction and homelessness in late 2020 and the whole of 2021 still lingers on even today. Many real estate experts feared that if not given a solution, it may result in another level of economic catastrophe.
According to another related survey, the prices of home property may continue to rise in 2022 and beyond. This is just one of the many economic devastations of the pandemic that governments around the world failed to prevent. And when these renters are evicted, they will face even more difficult financial challenges because of today’s rising rent prices, especially in big cities. Consequently, people who cannot afford to buy a property will continue to rent; making it more favorable to rich rental property owners.
Compared to the pre-pandemic era, renting rates of today are very high. In some states in the US, it is even predicted that buying a house will possibly become more affordable than renting. This is expected to manifest by some experts in 2022. With the demand rising and rental home supply seemingly becoming lower, workers with low income may have difficulty getting a good and decent home to live in. Though, in some places, there are options. However, in many states, this is predicted to become a reality.
Another trend that has grown bigger during the COVID era is remote working. Because of health protocols and other restrictions, millions of workers are forced to work from home and many also started their businesses. Renters look for larger units to rent in which they can set up offices and other types of workplace settings. Even though many establishments are now getting back to the normal workplace arrangements, it is also observable that the demand for larger space continues to surge; even pushing some states to build larger apartment units.
Aside from establishing the space as a place for work, another reason why many renters prefer to move into larger spaces through co-housing is that it helps them save money. Of course, a large proportion of those renters surveyed are the ones who can afford to pay for bigger spaces alone. However, the result has also shown that co-housing also became a trend when the pandemic also came; meaning many people preferred to live with roommates to help them pay rent.
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