Most of you have probably seen this video regarding the “deal” that appears to have…
Think. That is one word I grant you. But, sadly, something fewer and fewer people…
Researching the Washington, DC real estate market, I came upon some facts that shocked me. I started looking at federal government employment, knowing that the government is the biggest employer in the Washington Metropolitan Statistical Area (MSA).
In fact, the federal government is the biggest employer in the country, with about 1.8 million civilian employees. While times get tougher for those of us who don’t work for the government, life for those in government continues to be pretty peachy. In fact, things have gotten a lot better over the last ten years.
The growing discrepancy between the government economy and the “real” economy is causing many problems, but one is a growing disconnect between the government mindset and the private industry mindset.
Many landlords are attracted to markets with a large institutional presence because they offer stability. Hospitals, universities and government agencies rarely make major cuts in employment, and they very rarely close. That means your prospective tenants are not likely to leave.
This also used to be the case for military bases. Years ago, career soldiers could build very comfortable nest eggs by buying a home in every base where they were stationed, and keeping it when they were transferred. They would always be able to find other soldiers to rent their homes. That’s changed to some extent because of the number of base closings over the last couple of decades. However, the largest bases will remain active for many years.
Are these markets really stable?
Big institutions almost never make up more than half of the employment in any market, meaning those markets are still subject to other private industry employment losses and gains.
If someone were to have said, say a year ago, that there would be a…