Multifamily Housing Trend
Back in May, I wrote an article detailing the major departure of 25-34 year olds on Long Island, it was titled “Long Island Falling Short.” In that article, we uncovered the major reasoning of this mass exodus to be the lack of affordable housing/multifamily housing. I directly stated that attention and focus should be towards making serious changes and creating more affordable housing here on Long Island, as well as across the United States, as this issue is not isolated to Long Island.
Since I crafted that article, I’m glad to say that we’re beginning to see some positive changes in the multifamily market, both here on Long Island as well as across the United States. Here at American Investment Properties, Inc., we are constantly getting calls regarding multifamily housing; people are beginning to take real interest in these buildings. And there is proof that those like-minded individuals who believe that there needs to be a change in this market have begun to take necessary steps in the right direction. For example, Great Neck Plaza has begun developing affordable housing as part of two new projects. Also, affordable housing developer Peter Florey, director of D&F Development Group in Levittown, is currently working on two Long Island projects, one in Melville and one in the Village of Hempstead. And most recently, the Rechler Family, who are major Real Estate developers here on Long Island have formed Greybarn, a brand of upscale multifamily rental housing tailored for Long Island residents. Greybarn is planning to break ground within the upcoming months on its first project, a 500-unit luxury development that also includes 45,000 square feet of retail space on a 40-acre site in Amityville, New York.
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The need is there – “millennials,” those of the generation who reach adulthood around 2000, and the “empty nesters” adults whose children have moved out prefer to rent rather than to own on Long Island. These new projects targeting multifamily housing are the answer that many have been searching for and are what is needed in order for many to stay here on Long Island. About 20% of Long Island’s housing stock is rentals, which is a much lower percentage than many other suburban areas and therefore, there is a strong demand for rental apartments on Long Island as housing preferences shift. New construction for multifamily housing has picked up nationwide in recent months and looks to be alleviating the short supply, but the demand for rental housing is continuing to show strength across the country. Lawrence Yun, a NAR Chief Economist, states that “The multifamily sector continues to be the top-performer in commercial real estate with the lowest vacancy rates. However, tight availability – despite new construction – is causing rents to currently rise near 4% annually in many markets.”