The multi-family sector, which is hot now, is expected to grow hotter because household formations are expected to rise.
–Rentals as sound investments: More investors seeking higher yields are buying up apartments to satisfy that need. With Treasury notes, you’ll expect a 2 percent return. With rentals, it’s about 4 percent to 5 percent, according to the UCLA study. But what makes the investment sweeter is the high possibility of rent hikes, which increases returns. But a delicate balance must be struck, researchers said. Landlords could justify increases in rent because of low vacancy rates and higher demand, but increases that are too high could push some qualified would-be borrowers to buy.