Wait & See? or take ACTION??

Wait & See? or take ACTION??

Many people ask me:

Is this the right time to invest in apartments?

Aren’t we in a recession?

Shouldn’t I wait for things to settle down?

 

It isn’t about whether it is the right time or not…

You should be thinking “is this the right deal or not?”

 

Recessions aren’t always times of darkness. They can be seen as opportunities!

 

Many smart business people have thrived in times of recessions. They have found opportunities and capitalized on them. Not surprisingly, a ton of amazing companies were formed during times of recession.

Remember 2008-2010 recession and financial /housing market collapse?

Airbnb, Warby Parker, Venmo, WhatsApp, Uber, Pinterest, Instagram, Slack were all formed during that time. Now they are all billion dollar companies and are thriving!

 

These founders weren’t sitting around debating if they should wait and see , they thought about it and took action!

Same goes for savvy investors. There’s no shortage of smart investors who found lucrative deals during times of recession. Remember, people’s circumstances change, and economic volatility causes lots of distressed sellers and properties to go on sale.

Just today I was contacted by a broker letting me know that a property he listed 3 months ago has recently reduced its sales price by a few millions! From my perspective, it went on “sale”.

Ben and I are not planning on putting our my pencils down, we’re going to keep looking until we find a deal where the numbers look amazing! Because we’re not sitting on the sidelines, we’re not going to miss out on amazing opportunities.

 

In closing, this is the best quote to answer if this is the right time…

“The best time to start was YESTERDAY.

The next best time is NOW” 

Rethinking Your Investment Strategy in this Recession?

Rethinking Your Investment Strategy in this Recession?

Don’t Let Economic Uncertainty Sway Your Investment Strategy

Fears of a recession are all around. The S&P is down roughly 16% since the beginning of the year, cryptocurrency is down almost 60% from its peak, and the Federal Reserve raised interest rates again on Wednesday to combat the persistent inflation.

It’s only natural to have moments of uncertainty and to re-examine your investment strategies.

The Good News is that the market fundamentals of apartment investing are still present:

 

🏆 Multifamily is a historically recession resistant asset

🏆  Apartments hedge against inflation because leases are renewed yearly, keeping up with inflation

🏆 There is a home ownership affordability crisis- pushing our country into a Renter’s Nation

🏆 There is a lack of supply of apartments projected for decades, and building costs are going up

🏆 Unemployment is historically low

🏆 Texas is still exceptionally strong with high job growth, occupancy, organic rent growth

🏆 Tax Benefits for real estate are amazing with Bonus Depreciation at 100% through 2022

🏆 Over time real estate appreciates in value ...LOVE this quote by Will Rogers… 

 

Don’t wait to buy real estate. Buy real estate and wait.

 

 

Your money is safest when it’s invested in real estate

It’s not safe in your savings account…

It’s not safe in your retirement account… 

It’s not safe in your stock account… 

It’s not safe in cryptocurrency….

but it is SAFE in apartments.

Five Reasons Why Multifamily Real Estate Is The Best Place To Invest Right Now

Five Reasons Why Multifamily Real Estate Is The Best Place To Invest Right Now

Five Reasons Why Multifamily Real Estate Is The Best Place To Invest Right Now

With interest rates rising and the capital markets in turmoil, people’s fear is at an all time high! Let me assure you that apartments are still THE BEST place to put your money!

Five Reasons Why  Apartments Are The Best Place To Invest Right Now

  1. Hard assets like real estate are the best hedge against inflation, and apartments are arguably one of the best positioned real estate asset classes to create wealth in an inflationary environment. Why? Because the short-term leases allow apartment owners to pass along higher expenses to the tenant base through rent escalation. Apartment rent growth is outpacing inflation by a wide margin and is well positioned to do so for years to come, which will drive up returns. 

 

  1. Demographic trends are favorable for multifamily housing, particularly in regions experiencing net migration. Dallas is growing like crazy and  just moved up 5 spots in US News’ List  of Best Places to Live in 2022. The Dallas market is experiencing double-digit rent growth. It doesn’t matter if interest rates and cap rates rise, as long as they are outpaced by rent growth.

 

  1. Most of the underlying economic conditions that favor apartment investing remain solid. Employment is arguably the best economic indicator for forecasting the health of the multifamily market. There have been more than 20,000 jobs created in the Dallas market. Doing business in Texas costs less and many employers have moved here…bringing employees who need housing. Luckily, we are in the housing business and can provide affordable apartments.  😁  

 

  1. The debt terms for multifamily remain extremely attractive. Even with the recent rise in interest rates (and further increases likely on the horizon) the cost of capital for multifamily housing remains near historically low levels.  

 

  1. Multifamily real estate has proven to be recession resistant and offers superior risk-adjusted returns. In contrast, investments like stocks and cryptocurrency are subject to the whims of the market and have never felt more speculative and volatile.  Real estate is boring by comparison, but may allow you to sleep better and build more wealth in the long run. 

Even in a crisis, real estate remains a solid investment.

 

Put your cash to work in apartments—the best place to invest right now.

 

Apartments are the SAFEST place to invest right now!

Apartments are the SAFEST place to invest right now!

Apartments are the SAFEST place to invest right now!

One of the biggest threats to your wealth right now is INFLATION.

Inflation roared to an ALL TIME 40 year high in July to 9.1%. This is crazy! It might feel like it is higher than that when you start looking at gasoline prices and food costs. Check out this Bloomberg article about the ramifications!

Good news is that rent growth is near all AL TIME high too.  May Lease trade-out growth in May for Houston and Dallas were 13.5% and 20% respectively. And occupancy is nearing an all-time high with a record low apartment vacancy. This is largely due to a housing supply shortage, which according to this CNBC article, isn’t changing anytime soon. There is lack of supply projected for at least a decade! With rising mortgage interest rates, less people are moving to homeownership and are being forced into apartment living longer. 

There are multiple companies moving to Texas, such as Caterpillar. DFW has added twice as many jobs as any other market in the last couple of years.

This is the time to be investing your money in solid cash flowing, APPRECIATING assets like Apartments! Apartments are a safe place to keep your money

Even in a crisis, real estate remains a solid investment.

Put your cash to work in apartments—the best place to invest right now.

Are We in A Recession?

Are We in A Recession?

Recession Or Not, I’m Not Losing Sleep About It!

Are we in a recession?

 

Some experts say yes, some experts like Mark Zandi, Chief economist at Moody Analytics, say no. Check out this article in CNN discussing why we’re not in a recession.

 

Recession or not, we know the economy is “cooling off”

When this happens, something called “trading down” happens. This is where people are looking to trim the financial fat in their lives.

 

They might choose to forego restaurants and save money by eating at home. Consumers might shop at Walmart, instead of Whole Foods. As proof this is happening, Walmart recently announced that their sales grew by 8%. Applebee’s and IHOP have reported that they are gaining wealthier customers.

 

Trading down happens in the apartment markets too.

 

People who were renting Class A apartments might move to a Class B apartment, and renters living in Class B apartments might move to Class C apartments, and so on.

 

This is exactly why Ben and I invest in Class B and C apartments…because they are recession resistant. Recession resistant assets are our bread and butter!

 

People will ALWAYS need a place to live. We are providing them with safe and affordable options, particularly when the economy is down, and people are under financial pressure to cut costs.