Affordable housing has always been a stable investment asset through up and down economic cycles, but the pandemic has deepened demand and exacerbated supply constraints. The dynamic is pulling more investment capital to the market from both foreign and domestic investors.

"We have noticed that affordable housing tends to perform in times of economic uncertainty and in a growing economy," John Williams, president and CIO at Avanath Capital Management, tells GlobeSt.com. "This is appealing to investors as it can act as a stabilizer in a portfolio and allow for diversification. Foreign and domestic investors alike continue to be attracted to US affordable housing for these reasons as it offers downside protection and is a durable investment option."

Affordable housing was in a state of crisis before the pandemic. Nationally, all segments of affordable housing—from low-income to workforce—have been supply constrained for years. During that time, demand has only grown. "Demand for affordable housing has always outpaced supply. As home prices continue to increase and the gap between wages continues to widen, demand has rapidly increased," says Williams. "According to the National Multifamily Housing Council, prior to the pandemic the US would need to build an average of 328,000 new apartments every year by 2030 in order to keep up with growing demand. NMHC also states that this is a number that has only been reached three times over the last 30 years, resulting in a significant lack of affordable supply."