Retailers in the U.S. plan to open more new stores this year than close stores, indicating a hopeful sign for a rebounding sector. The news of more retailers in expansion mode follows a strenuous year of survival for many retailers, in which the COVID-19 pandemic caused many shutdowns in 2020.

Grocery, fast-casual, and value stores are the retail leaders that are planning to expand this year, according to the report from RetailSphere. More than half of the companies in these three sectors say they intend to further develop their businesses this year, according to RetailSphere.

“Some companies are opening a handful of stores; others are expanding by hundreds,” according to the report. “Grocery, convenience, and fast-casual and value dominate the list of national and regional retailers that are growing.”

Discount stores—like Family Dollar and Dollar Tree—are expected to add the most stores this year, opening 500 and 700 locations, respectively.

During the pandemic, retailers closed a record number of locations, according to CoStar Group. But the increase in vaccinations and a rebound in consumer spending in brick-and-mortar retail locations is helping the retail sector to recover.

2021 is on track to have the least amount of retail shops closing in more than a decade, according to CoStar.

The sector isn’t out of the woods yet, however. Fears over an increase in COVID-19 cases could curtail in-person shopping once again. In July, 58% of shoppers surveyed say they felt safe going into stores. But in August, the highly contagious delta variant began to spread in the U.S., causing that percentage to drop to 47%, according to a retail report from Springboard.

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A recent decline in lumber prices is helping to mitigate building costs, but that effect is being offset by numerous increases in other building materials that are surpassing records. Home building materials have climbed by up to 19% over the past year, according to the Bureau of Labor Statistics Producer Price Index.

The building materials that have seen the largest increases so far in 2021, according to the National Association of Home Builders’ Eye on Housing blog, include:

• Steel mill products
• Building paper and building board mill products
• Asphalt
• Plastic water pipe
• Fertilizer materials
• Laminated veneer lumber
• Thermoplastic resins and plastics materials
• Structural metal joists and concrete reinforcing bars
• Wood window and door frames
• Copper pipe and tube

The price change in steel mill products has been most notable, climbing 81% year over year. That follows an 11% increase in 2020.

The median sales price of a new home in July was $390,500, an 18.4% increase compared to a year earlier, according to the Commerce Department. Builders say the higher prices are due to the increases in development costs, including materials, that are being passed along to home buyers.

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Investors are pouring in millions to create more built-for-rent single-family communities. It’s fueling a land rush to find open land.

“Land brokers dealing in residential parcels traditionally sell to developers and builders who are planning communities in which people buy homes,” Forbes.com reported. “Now, they are starting to see a growing share who are buying land to build rental single-family communities.”

Greg Vogel, who runs Land Advisors, one of the largest land companies, told Forbes.com he expects the percentage of land sales in the built-for-rent sector to double or triple over the next couple of years.

The rental yields are even allowing built-for-rent investors to start outbidding home builders for land. Single-family rents have climbed 7% to 10% over the past 12 months in many areas.

Since the pandemic, renters are showing a desire for more space and the comforts of single-family living.

Land parcels for rental townhomes are the highest in demand, Forbes.com reports. The built-for-rent land rush is particularly climbing in areas like Augusta and Savannah, Ga.; San Antonio, Texas; St. Paul, Minn.; and smaller cities in Florida like St. Cloud, Pensacola, and Port Charlotte.

“The potential for growth is enormous,” Brad Hunter, a housing economist for Hunter Housing Economics that focuses on the BFR sector, said on Forbes.com. Developers in the built-for-rent space are realizing the underserved demand and the numerous drivers of growth, like rising household formation and skyrocketing home prices, that will lead to a long-lasting desire for built-for-rent single-family homes.

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College towns have long had the reputation of being achievers when it comes to real estate investments. They can also offer a great home for young adults, families, and retirees.

Realtor.com®’s research team evaluated nearly 200 cities with at least 10,000 residents–where undergraduates comprise at least 20% of the population. They factored in housing near campus as well as the number of businesses around them.

College towns generally have “steady economies that have less ups and downs,” Mark Zandi, chief economist at Moody’s Analytics, told realtor.com®. College towns can “make very attractive places to live for people who want a more affordable, low-key lifestyle. In many cases, there are reasonably good school districts and lots of different housing choices.”

The following are the top college towns to buy a home for young adults, according to realtor.com®’s analysis:

Champaign, Ill.

• Median home price: $180,900
• Largest university: University of Illinois at Urbana-Champaign
• Student share of population: 38%

Burlington, Vt.

• Median home price: $414,950
• Largest university: University of Vermont
• Student share of population: 34%

Boulder, Colo.

• Median home price: $1 million
• Largest university: University of Colorado Boulder
• Student share of population: 28%

The following are the best college towns for families, according to realtor.com®:

Salisbury, Md.

• Median home price: $230,000
• Largest university: Salisbury University
• Student share of population: 23%

Madison, N.J.

• Median home price: $837,050
• Largest university: Fairleigh Dickinson University
• Student share of population: 26%

Chestnut Hill, Mass.

• Median home price: $1.6 million
• Largest university: Boston College
• Student share of population: 24%

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U.S. mall traffic rebounded this summer as newly vaccinated Americans felt more comfortable leaving their homes. The surge has continued despite growing threats from the fast-spreading COVID-19 delta variant.

“After a year and a half of staying inside, there was a pent-up demand for doing something, and that something could have been just going to a mall,” Sarah Helwig, an assistant vice president at Morningstar Credit Information and Analytics, told The Wall Street Journal.

Mall foot traffic in July surpassed even 2019 levels, according to Placer.ai, a data analytics firm. Mall visits rose 0.7% compared to July 2019, prior to the pandemic. Outdoor malls continued to be more popular.

The rising foot traffic increased retail sales. That also offered good news to mall investors who in the initial months of the pandemic saw profits drastically decline from shutdowns and worried shoppers.

Justin Kennedy, managing partner of 3650 REIT, said his first priority is looking for more malls to invest in.

Still, Challenges Lie Ahead

The U.S. shopping mall sector does face some headwinds in the months ahead, however. Rising COVID-19 infections could make shoppers more comfortable staying home once again, analysts told The Wall Street Journal. Also, vacancy rates are still rising: Vacancies were at 13.7% over the past year for malls with securitized mortgages, according to Morningstar Credit Information and Analytics.

Older malls continue to struggle the most, especially those that have lost large department store tenants.

Also, fewer clothing retailers are signing leases, which is also prompting concerns about filling storefronts. More malls reportedly are considering nontraditional tenants that offer more entertainment options, such as trampoline parks or rock-climbing gyms.

“A trampoline park was not the most desirable tenant to bring to a mall a decade ago,” Corey Bialow, CEO of Bialow Real Estate LLC, a brokerage firm that represents retail tenants, told The Wall Street Journal. “Now there’s not a lot of people taking 30,000- to 50,000-square-foot spaces anywhere in the country.”

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Multifamily units are driving the gains in overall housing starts last month as more apartment projects were initiated. But single-family housing starts fell 2.8% in August to a seasonally adjusted annual rate of 1.076 million units, their second consecutive month of decline, the Commerce Department reported Tuesday. While single-family starts dropped in the West and Midwest, they still rose in the Northeast and South.

“There is certainly a housing shortage, as reflected in the low inventory of homes for sale and in low rental vacancy rates,” said Lawrence Yun, chief economist of the National Association of REALTORS®. “However, a shift toward rental buildings means less access to homeownership over the long run and the accompanying opportunity for wealth gains.”

Rental demand is increasing. The multifamily housing segment is being driven by a demand for rentals as consumers move back to the city and remote workers prepare to return to their offices. Multifamily starts, comprising mostly apartments, climbed 20.65% in August, while multifamily permits, a gauge of future construction, increased by 15.8%.

Demand remains high for newly built single-family homes, but builders face several challenges, including labor and lot shortages and the rising cost of materials.

“Given the housing shortage and the lack of big increases in the construction of single-family homes, home prices will continue to move higher than most people’s income gains,” Yun says. “That’s good news for property owners, but bad news for those wanting to become homeowners.”

The median sales price for a single-family new home in July was $390,500, up 18.4% from the $329,800 median sales price posted a year earlier.

Still, Robert Dietz, chief economist of the National Association of Home Builders, said he is hopeful that new-home inventory will increase over the coming months. Despite this month’s decrease, the number of single-family homes under construction in August—702,000—was the highest since the Great Recession, he said. “While some building materials, like lumber, have seen easing prices, delivery delays and a lack of skilled labor and building lots continue to hold the market back,” he said. But “more inventory is coming for a market that continues to face a housing deficit.”

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