5 Ways the Rising Demand for Corporate Housing Is Impacting The Real Estate Industry

Surveys have shown that more than half of employers have budgets for significant sign-on bonus and relocation packages. To that end, executives have seen the value in corporate housing units, which function in a similar way to the average apartment. However, there are a few key differences that are vital to note.

Corporate housing often exists in slightly above average or newer communities, and some units are already furnished to alleviate the pressure of moving. The lease terms are also more flexible, and tenants can agree to monthly and even weekly rental agreements. Naturally, the business owner enjoys benefits as well.

An investment in corporate housing can provide a high degree of comfort for employees, improving their focus and engagement on the job. They can acclimate to their new situation with far less difficulty. A transition that might have felt stressful is much easier to manage, both for the worker and their superior.

What does the rising demand for corporate housing mean for real estate professionals? How is this housing niche affecting trends in the industry? As you review and revise your current practices, consider the short- and long-term effects of corporate housing on the trajectory of the real estate market.

  1. Higher Frequency of Mini “Pre-Retirements”

The unique qualities of corporate housing have made the relocation process more convenient. With the normalization of these practices, more Americans may begin to engage in mini pre-retirements in new locations. They’ll remain in a given place for a short amount of time to see how they feel about the experience.

In the past, the main restrictions on mobility were the high cost of hotel stays or the constraints of a lease. The prevalence of short-term rental accommodations will soon allow people across the country to enjoy the comforts and conveniences of a home without sacrificing their freedom and flexibility.

  1. Boost to Short-Term Rental Market Growth

The short-term rental market has experienced significant growth in recent years. According to a CBRE research report, Airbnb has as many as 3 million listings worldwide. Similar services like HomeAway and VRBO make it clear that the short-term rental market will only continue to gain momentum.

Corporate housing will increase the already high need for short-term accommodations. As realtors continue to participate in the sale of properties for this type of housing, it will place even greater strain on the available inventory. The demand for these arrangements has already outpaced supply, which may lead to more issues.

  1. Increasing Pressure From Short-Term Rentals

The upward trend of short-term rentals has caused a range of issues. Some claim it has induced rent inflation, while others refer to the housing shortage mentioned in the previous section. However, experts say these growing pains are normal and nothing you need to worry over.

Even so, the maturation of the short-term real estate market will exacerbate many of the problems industry professionals face today. At the same time, the heightened demand for these accommodations isn’t entirely negative. It might provide more opportunities for realtors who intend to take part in the sale of properties for rental housing.

  1. Growing Popularity of Furnished Apartments

Many business owners that are interested in this housing niche search for furnished corporate housing or apartments. These options alleviate the pressure of relocating. An employee can acclimate to their new living situation with fewer issues, as everything they need is immediately available.

Furnished options in corporate housing may soon extend to other areas of real estate. Given the success of the concept in short-term rental situations, its viability elsewhere has promise. Tenants may have greater expectations of real estate investors with the normalization of fully furnished living quarters.

  1. More Opportunities for Strategic Partnerships

Corporate housing represents a lucrative niche for assertive investors. If they reach out to new residents as soon as they start exploring a new city, they can position themselves as their primary resource. The resident will naturally turn to the investor if they want to graduate to a long-term apartment or home.

The increase in corporate housing operations has other benefits for real estate investors. They’ll enjoy more crossover opportunities, enabling them to increase their ROI and income. In short, real estate investors will seek strategic partnerships with other professionals more frequently, and with greater success.

Looking Toward the Future

The rising demand for corporate housing will have an enormous impact on current trends in real estate. It’s essential to study the effects of this niche, as it has far-reaching implications for the rest of the industry. When you fully understand its reach, you can capitalize on everything corporate housing has to offer.

As you move forward, it would be wise to research the subject of corporate housing in greater detail. It has significant potential for real estate professionals, and its present and future value is critical to consider.


Kayla Matthews
Kayla Matthews
Kayla Matthews is a biz technology journalist and cybersecurity writer. Her work has also been featured on Security Business Insider, Contently, Outbrain and others. To read more from Kayla, please visit her personal tech blog: Productivity Bytes.

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