Which asset type is perceived as the least volatile?

Multifamily properties are perceived as the least volatile asset type primarily due to their consistent demand and steady income potential. Residential housing tends to maintain a relatively stable occupancy rate because people always need a place to live, irrespective of economic cycles. This makes multifamily properties less susceptible to drastic fluctuations in occupancy and rent prices compared to other asset types.

In contrast, hotels can experience significant volatility based on travel trends, economic downturns, and seasonal variations, making their income less predictable. Senior housing might also reflect volatility, particularly influenced by shifts in healthcare policy and demographic factors. Commercial real estate, while it can provide strong returns, often faces risk due to economic downturns affecting businesses, leading to higher vacancy rates and rent reductions.

The stability of tenant demand for multifamily housing, combined with its essential role in providing housing, contributes to its reputation as a less volatile investment compared to hotels, senior housing, or broader commercial real estate.