Up, up and away? Are we living in the PPW ( Post Pandemic World)…
I’ve got a question for you, are we living in the PPW or Post Pandemic World?
I hear it all the time from investors, is it a good time for me to invest? Is the economy improving? Maybe you are nodding your head right now because you totally had the same questions in your mind.
What if I told you we have some data that supports the idea that we are now entering the PPW?
It has been well over a year since the pandemic wave washed over the US. The economic, medical, and social ramifications are well documented. However, the situation on the ground is changing rapidly and it’s important for us to have an updated picture of the macroeconomy so that we can make our apartment investing decisions based on timely data.
I deeply believe that when we have the most relevant data and insight we are able to make the most accurate and timely investment decisions that not only help us preserve our capital but also helps us grow it 10 fold and beyond.
The June 2021 Special Edition report from NMHC 〰️ the National Multifamily Housing Council makes some really strong cases as to why the US is about to enter a post-pandemic world.
Hear me out because there are 6 major reasons you could benefit now more than EVER from multifamily apartment investing:
- Pandemic/ Vaccination
- Economic Growth
So let’s hop into the specifics 👇
Pandemic/ Vaccination: The economic recession was driven by the COVID-19 pandemic, and as a result, a medical solution is required to solve the economic problem. The introduction of a vaccine last December has made exceptional headway toward resolving both the pandemic as well as the economic challenges it created. By the beginning of June, about 41% of people have been vaccinated which will likely rise in mere days past 50%. As the U.S hits critical mass on vaccinations there are predictions that we may soon be able to reopen our economy with no fear of liability from this deadly virus!
Employment: In the pandemic-induced economic downturn, 22 million jobs were lost. As we rebuild our economy to produce a new era of prosperity for all Americans, workers are being re-hired as they return from time off after staying home during the pandemic. This influx in job demand can also fuel housing growth.
Confidence: The fact that confidence in the economic recovery is high is a promising sign for our future. Consumer confidence levels are returning to the pre-pandemic level. Businesses are continuing their hiring efforts at a fanatic pace.
Spending: The stimulus package injected an unprecedented $5.7 trillion into the economy, and today’s retail sales stand at 15% above pre-recession levels! Home sales are on their way up – just last month home prices hit a 2 year high. Air travel has been slow to recover since the pandemic; however this summer it should see an increase due mainly to business travelers returning and families traveling for vacations again too.
Economic Growth: To put it bluntly, the United States is in a unique situation. As more people become vaccinated, they’ll be able to unload their bank accounts and other assets on pent-up demand. This will create an unprecedented boom for businesses.
Inflation: The Fed’s optimistic view on inflationary pressure is becoming less realistic. Record-level economic growth has brought with it challenges, such as a potential surge in inflation that could also pose risks to our economy if not taken seriously soon enough. The Federal Reserve indicated they believe the inflation will be transitory but there are several elements of this rise in prices that may prove more long-term and detrimental than initially thought “particularly wage growth and housing cost.”
Shortages of key commodities and manufacturing materials in addition to shipping/distribution limitations are weighing on the availability of goods, with prices rising significantly in the last quarter. This trend could weigh heavily on our growth outlook for this year if inflation does not ease up any time soon! In the same token, apartment investors can find a silver lining with the rising inflation, property values that have a correlating relationship with inflation will also rise as well and this provides the best hedge for inflationary pressure.
INVESTING TO LIVE YOUR LIFESTYLE DREAMS AND TRUE FREEDOM.
So, do you agree with the NMHC report? I hope that these 6 reasons have shown you the benefits that multifamily apartment investing can have in your life. Multifamily apartment investing is truly one of the best wealth-building strategies you can do for yourself and your family! By investing in the right asset class you get more time to do the things that you LOVE.
Now, in our core markets, we are experiencing tremendous rent growth, strong occupancy, and collections. And we certainly hope this trend continues.
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Until next time, ciao!
Palmy Kitti 〰️ the other 1/2 of
The Kitti Sisters