Real Estate & Proptech Insights in Early 2025: Multifamily, Zillow Housing Market Predictions, and LA’s Housing Crisis

Welcome to the first 2025 PropTech Edition! I’m Wes Snow, and I'm excited to bring you the freshest industry updates as we kick off the year.

We’re starting the new year with an overview of investment opportunities and the housing market. Let’s take a closer look.??

Investment Trends for 2025?

What I can see right now, multifamily housing continues to dominate real estate. Here’s why:?

• Strong Rental Demand: Rising housing costs and delayed homeownership among millennials and Gen Z make renting the go-to option, fueling consistent demand.?

• Affordable Housing Shortage: With only 33 affordable units per 100 extremely low-income households and a need for 4.3 million new apartments by 2035, this sector addresses a pressing gap.?

• Economic Stability: Multifamily properties are resilient, offering steady returns even amid market uncertainties.?

• Accessible Investment Options: Multifamily REITs allow investors to benefit from a thriving rental market without the complexities of property management.?

Find out more information in our piece: Navigating the World of Multifamily AI?

On the technology front, AI and cloud computing continue to dominate as transformative forces in the investment landscape. Global AI spending is expected to grow at an impressive 19.1% annually through 2027.?

I believe that understanding these trends can help you make informed investment decisions in the year ahead.?

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Zillow Housing Market 2025 Predictions?

What’s shaping up to be competitive in 2025 is the housing market. With strong demand and limited supply, key cities are expected to see continued price growth.?

According to Zillow, Buffalo, N.Y., is set to remain the hottest market for the second year. Indianapolis, Providence, Hartford, and Philadelphia follow in the top five.?

Keep up with the 2025 proptech trends here.??

?Affordability and limited supply are undeniably fueling demand in these markets. As I see it the reason Buffalo is standing out, thanks to its job growth that continues to outstrip the pace of new housing permits. Even though inventory levels are gradually improving, they’re still far from pre-pandemic numbers, so competition will likely remain fierce for those looking to buy.?

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Wildfires to Worsen LA’s Housing Crisis?

Yet another challenge we're facing in the US this year — the catastrophic wildfires in Los Angeles. These fires will worsen the region’s already critical housing shortage.??

The area’s housing shortage, already at 337,000 homes, will get worse as displaced residents look for places to live. Rents will increase, especially near fire hotspots like Pacific Palisades and Altadena, with landlords potentially raising rent and evicting tenants to take advantage of displaced homeowners.??

“You’re going to have a positive shock in demand, and a negative shock in supply, so this automatically means prices go up in the rental markets,” said finance expert @Carles Vergara-Alert.?

As for rebuilding efforts, @Stuart Gabriel emphasized that the city needs to revolutionize its permitting process to speed up recovery, urging the city to simplify approvals for wildfire-affected homeowners. “If the city of L.A. wants to stay competitive...the critical imperative is to deal with the availability of affordable housing,” he warned.?

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Beams Secures $9M to Transform Home Renovations in Europe?

While LA grapples with housing challenges, across the Atlantic, innovation is reshaping the way we approach housing upgrades.??

@Beams, a UK-based startup, provides a marketplace that connects customers with builders. Their software uses 3D scans and laser imaging to predict project costs, timelines, and designs, making home renovations more efficient.?

So, as I can see, Beams is addressing a critical gap in the home renovation market by providing tech-driven solutions.??

And that wraps up this week's roundup of real estate and proptech news. Share in the comments your predictions for 2025.????