Is it just me, or are we on the edge of great opportunity?

[Jared Smith]

I have been hearing similar patterns from multiple sources lately and the data seems to be pointing in the same direction: Are we on the edge of great opportunity in real estate again? 

•There has been suppressed rental growth due to the over building of MF properties which is now at an inflection point again going into 2026.

•As the MF build rate slows due to the higher interest rates, that will likely apply upward growth on rental rates. 

•Interest rates are at a 10 month low and seem to be on track to continue down.

•As rates drop, more buyers enter the market, with more buying power, this will most likely provide upward pressure on prices.

What else is everyone seeing? 

[Lesley Resnick]

I am bullish on AMERICA.  This is a long game.  If think you are retiring on any one deal, you are probably in the wrong business.  Over time and a disciplined approach, you will get there.

There are always good and bad deals to be found.  There is a lot of money on the sidelines waiting for clarity and some level of predictability in the economy.  I think that money coming into the RE market and the health of the overall economy will effect the market.  

Bear with me for a second while I geek out.  There is a principle in economics called financial repression.  The idea is that if a government has a large debt as we do, the government will allow inflation to stay above average levels and lower the interest rates.  The dollars become worth less than the dollars that were originally borrowed.  That is actually the classic definition of inflation.  It is money having less value, to purchase goods and services than during previous periods.  Increased price is a side effect.  When inflation runs high and debt service costs shrink, lower rates, the debt shirks buy the gap between inflation and the cost of money.  It gives politicians the appearance of doing something positive. 

In this scenario, the losers are people holding cash or cash equivalents, saving accounts money market, bond funds and highly leverage banks.  

The winners are politicians and government.  People holding leveraged hard assets, real estate with a loan will be protected from inflation as the price of your property rises.  The payments you make to the mortgage company will be made with less valuable dollars.  RE investors will benefit from the same gap. 

In short, financial repression is good for RE investors and not as good for main street.  The media will not be covering this sine it does not make a good sound bite and it is a complicated idea.

I do see better days ahead.