Me and my two partners own and manage 1109 apartments between Dallas and Houston. Roughly about $195mm. Which in the grand scheme of things makes us a smaller player. But across our portfolio (all multi-family) were at about 96% occupancy, 8% yoy rent growth (coming down month by month) and operationally doing very well. Where were getting WHACKED though is with property taxes and insurance. Insurance has gotten insane.
Rolf. No. You crush inflation by having FF rate 100-200bps OVER inflation rate.
Because claims are insane because inflation is insane. Which may eventually put pressure on your rents.
claims are insane because of plaintiff attorney's planting billboards every 100 yards and declaring they can get multi-million dollar verdicts for broken ankles. "social inflation"
Not sure where you are getting your info from. Office was not dying pre-COVID. NYC was trading 4.5% cap rate and avg occupancy was 92%.
See my post #23,703 in this thread. It’s an issue but not fatal.
You do realize that at some point you have to stop taking the one up while the other continues to go down?
| Feb '23 | 6% |
| Jan '23 | 6.4% |
| Dec '22 | 6.5% |
| Nov '22 | 7.1% |
| Oct '22 | 7.7% |
| Sep '22 | 8.2% |
| Aug '22 | 8.3% |
| Jul '22 | 8.5% |
| Jun '22 | 9.1% |
| May '22 | 8.6% |
Right, it shouldnt have been. Anyone with half a brain knew office was dying a slow death. Covid just sped it up
LOL! Give it up. Inflation is over. As per my previous posts, where is this mystical inflation? Home prices? No. Oil/energy? No. OER? No. Commodities? No.
It surprised you that office real estate was whacked? It was one of the more predictable trends over the past decade or so
Totally disagree. Office was hot before COVID. Companies were going to hoteling model because space was expensive and hard to find. Giant tech companies were buying buy office buildings. if you saw it coming, you should’ve bought puts on office REITs. Btw, class A office is still hot in NYC. Rents are over $150 PSF. It’s the class B and C stuff that’s in trouble.
I dont dabble in the stock market. But i honestly dont know a single person who was bullish on office or retail even pre covid. Granted most people I know prefer multifamily and thats a superior asset class
In my circle, MF is like kissing your sister. Very safe and stable product.
Agreed. MF is traditionally boring and steady. Past few years were an anomaly where you were able to achieve returns like this
Well to re-phrase, just as I didn’t bank on those type of returns on that deal, I’m not gonna bank on those type of returns on any deals going forward either
Inflation will definitely be over at some point. It seems very likely that it will end due to a recession and not a soft landing. Regardless of what you and I believe where inflation has been in the past year, only the fed's view on inflation counts. As far as the fed is concerned, there is still inflation.
wow... we went from 9 to 6....
Not quite what you're thinking herecash baby!!!
pump it!!!
Larger reserve requirements for banks is the answerDeutsche Bank shares slide after sudden spike in the cost of insuring against its default
Deutsche Bank shares fell on Friday after a spike in credit default swaps on Thursday night, as concerns about the stability of Europe's banks persisted.www.cnbc.com
They only had 15 years to fix it.Deutsche Bank shares slide after sudden spike in the cost of insuring against its default
Deutsche Bank shares fell on Friday after a spike in credit default swaps on Thursday night, as concerns about the stability of Europe's banks persisted.
The Fed is slowly learning about gov'ment data vs real-time data. This is why their dot plot says only one more meaningless 0.25% hike.
Actually SoCal the humor here is that what you wrote above is not even in the same universe to what I suggested. You said the fed needed to have the rate 1-2points > inflation rate in support of higher rates. I said it doesn't because it is already at 5 and the way inflation is going it will be there soon enough. Taking it to 6 when it is already at 6? You said it yourself.
If you graduated in 84..then you remember the 70s...
3% inflation is just as fine as 2%. Even Powell admitted to Congress that there is no economic reason for the 2% target. It's completely arbitrary. The real target should be based on real inflation, but that is very hard to measure and track.
again, that's not what I said. I said "right now" while the market "would be" is jumping. In other words having my retirement cash grow say 12-15% would more than offset a 4% inflation rate. Yes. I didn't say on-going . and you are comparing 3% to the 12-14 % variable rate mortgages ? (mine was a 3 year adjustable @11% before it peaked)
One problem is that the interest rate should have been raised several years ago and your assets wouldn’t have been 20-25% higher. The rate of return would have been much lower in the past. Everybody is happy when returns are high but don’t expect it to continue forever. Some even say there might be hardly any return in the next couple of years.
