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.