Mostly defined by economic conditions, investing is a game of winning and losing. While you never really know which direction the economy is heading, one thing you can do is hedge your bets for profit or loss, depending upon the nature of your decision. In this article, we will discuss four reasons that make multifamily and build-to-rent the best investment during recession. So, without further ado, let’s begin.
People Will Always Need a Place to Live
Housing is a basic need for every human being. A person might hold off from buying a new phone or a new car during a time of recession, but you will never hear that someone decided to live on the street. So, if your build-to-rent or multifamily property is in good condition, there’s a high chance that you will find good tenants in no time. In order to maximize returns, all you need to do is buy an investment property in a good location and ensure proper management.
Real Estate Is More Stable
Do you know what the Great Recession of 2007 and the COVID economic boom of 2021 have in common? They both flipped the stock market on its head. However, none of these affected the residential real estate market. In fact, multifamily and build-to-rent properties recorded positive values at the end of the recession.
Residential Real Estate Offers Comfort During Recession
When it comes to finding the best investment during recession, there’s a misconception that commercial real estate is more profitable than residential real estate. However, it is no less than a myth as COVID19 was a harsh reminder to the world that commercial real estate isn’t always reliable. While the pandemic forced several businesses to close, many people (especially students and small families) started looking for a safe place to live, which resulted in booming the multifamily and build-to-rent sectors.
Cash (Flow) Is the King
Even though stocks are an incredibly powerful asset, there is a reason why people hold them in their retirement accounts and only cash them after they retire. The profit that you get for investing in stocks widely depends upon the growth of those stocks, which makes them an unreliable investment. On the other hand, investing in multifamily and build-to-rent not only provides you with a stable source of passive income today, but because property tends to grow in value over time, there is a great chance that you will get an amazing profit at the time of resale.
Wrapping It Up!
No one wants to suffer during a recession or otherwise. It doesn’t only upset your finances but also dramatically reverses the course of your life. However, when it comes to multifamily and build-to-rent property owners, an economic downfall can actually place you at a favorable vantage point where you can benefit from the crisis.
Just remember that no matter what happens, people will always need a place to live, a home that provides them good quality of life. So, if you are planning to grow your investment portfolio, multifamily and build-to-rent is undoubtedly the best investment during recession.