Student housing andmultifamily are both considered recession-resistant asset classes.The reasoning is simple: even in a down market, people still need aplace to live and students still go to college. While multifamilyhas been favored, student housing may actually perform better in adown cycle, according to Frederick W. Pierce, IV,of Pierce Education Properties.

“While more students pursue an education during a down cycle anddemand for student housing expands accordingly, multifamilyoccupancies and rents are highly correlated to the economy,”Pierce, president and CEO of Pierce Education Properties, tellsGlobeSt.com. “When unemployment increases, renters become moreprice sensitive.  Those who are laid off often double upin housing with friends and family. Generally, none of thosefactors impact students and their demand for housing.”

While multifamily is resistant to a downturn, it is certainlystill affected by economic changes. Even in the mildest downturn,rents are stalled of fall. “Those who retain jobs, but do not getpay raises or even get salary cuts, have to tighten their belts andcan't pay higher rents,” says Pierce.