Future trends and possibilities for the housing market?

Future trends and possibilities for the housing market?

Rental Property Investor · MD, 20878 · Member since 2019 · 18 posts · 5 votes

These are trends (some are already occurring, others may/may not happen) that we see and hear in the news more and more nowadays. Has anyone looked into these factors and see how it may affecting the housing/rental markets at a macro level? And then again it may not matter as real estate is as they say 'local.'


Already occurring:

1. 10,000 people in the US are turning 65 each and every day. This is why the Medicare Advantage and Medical Supplement businesses are booming big time. With this influx of older population we also see 55+ housing and nursing businesses growing. So, all of these people will eventually be moving out of their older homes that will need major renovation. Most likely than not, these homes will be sold in doves.  

2. Low and Negative interest rates are a reality in the US and around the world. We most likely will see this trend continue as the world economy intertwines deeper. This means cheaper credit to purchase homes and maybe lower intensive to rent.

3. QE has helped the equities market after 2008 and created record levels for NASDAQ, S&P and DOW JONES. How long will this trend continue and what happens when we see this artificial uptick reverse trend? How many salaries employees who bought their homes with credit survive another round of massive prolonged layoffs. 

Most likely will/ will not occur:

4. Millennial will manage to pay of their student debt and outgrow MFH and apartment complexes. Will they want to settle down and start a family by purchasing cheaper homes?

5. In the next economic downturn how many REI will be underwater and never want anything to do with this industry? Heard a podcast recently where the speaker said 80% of members here on BP acquired at least 1 investment unit in the last 12 months.

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  • Real Estate Investor · Des Moines, IA · Member since 2016 · 922 posts · 533 votes
    7y

    @Everest Jordan

    Good thoughts, however I don't see how most of that would directly affect our purchasing or design decisions in real estate.

    In my opinion, it's good to be thinking about these things, but in terms of mind-share in evaluating macro items, I'd much rather be thinking about fundamental economic indicators for an area we're investing in, or the overall domestic (US) market.  We have limited time, after all.

    Unless these 'trends' would affect decision making, generally speaking, they affect all of us equally as RE investors.  Again, of course that's not true for folks in commercial RE going after senior living facilities, as an example.

  • Specialist · Huntingdon, PA · Member since 2018 · 162 posts · 147 votes
    7y

    @Everest Jordan, I recently listened to an expert panel discussion with James Eng, Dino Pierce, Jonathan Twombly and Jeremy Roll.

    They had some interesting things to say from a macro point of view.

    James, Jonathan, and Jeremy were certainly advising caution.

    For example, James Eng mentioned that he looks at dozens of T12's every day and what he is noticing is that the rents are flat, so at the moment there is no ability to drive rent growth.

    This tells him that the market is definitely softening.

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