Workforce Housing Grabs Investor Interest, Regarded As Recession-Proof

Workforce and affordable housing are gaining the attention of real estate managers and investors.

While the overall apartment market dropped 10% year-over-year, the availability of affordable housing units declined only 4% as of the end of June, Pensions & Investments reports.

The sector is largely regarded as recession-proof and an estimated 4.5 million new apartments are expected to be in demand by 2030, making it increasingly appealing to the investment community.

Workforce housing is typically defined as apartment buildings that cater to the middle-income renter. These have become more popular as a larger portion of people have been priced out of cities.

In California, the City of San Francisco and Related California recently completed the largest 100% affordable housing development in the city in more than a decade to ease some of the affordable housing issues faced by residents.

California also offers tax credits and bond guarantees to developers that include affordable housing in their projects, leading many investors to invest in debt in the sector as well as equity. As many states and municipalities provide support for affordable housing, debt investment also picks up.

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