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Winter 2019 marks our company’s 10-year anniversary. It’s hard to believe that 10 years ago, life threw me a curveball and I didn’t know what to do.
In June 2009, I was laid off from my job as an analyst at Capmark and couldn’t get another job in real estate, so I decided to try my luck investing in real estate, even though I didn’t have a formal education in this space.
The Federal Reserve’s Policy Committee (FOMC) sets a desired range for inflation between 1.7%-2%. The FOMC monitors inflation using the Consumer Price Index (CPI), which measures the average change over time in prices that consumers pay for a certain basket of goods and services.
The apartment business doesn't seem like the kind of arena that can kill you. It's not likely to cause one of those obvious tragedies, and I'm not trying to make light of them. But the apartment business could kill you financially. In my opinion, financial death happens when you lose money and lose a property. It's one thing to not make a return on your money for a period, but it's entirely different to lose the money you've invested.
Over the past year, I've read about 50 books and listened to countless podcasts. One of the recurring themes is this idea of Mental Models. Mental Models are like shortcuts for thinking. They simplify complex situations, rate some items as more relevant than others, and underpin how we reason. We aren't aware of what goes into our decision making, but that's when our Mental Models kick in. We use them to make sense of our surroundings and organize them into an understandable framework.
Where is the next opportunity? It's the million- or (multimillion-) dollar question.
Here's our snapshot of the current multifamily real estate investment situation:
There is still a lot of enthusiasm in the multifamily apartment market. All the indicators are positive and there is a general sense of optimism that things will continue to be strong for the foreseeable future.
These past nine years have seen an incredible increase in values across the entire multifamily spectrum. I would argue that it is hard to find people who lost money in the space during this time frame.