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Proprietary Data Insights Financial Pros Top Large Cap Residential REIT Searches This Month #1 AvalonBay Communities 4,443
#2 Invitation Homes 4,087
#3 Equity Residential 3,930
#4 Mid-America Apartment Communities 3,143
#5 Sun Communities 2,537
#ad [Closing Soon: Invest in NowRx by May 20th.]( A Play On Luxury Apartment Rentals Thereâs some interesting news at the intersection of whatâs always a hot debate - should you rent an apartment or buy a home? Weâll get to that, but first ⦠In such a hot housing market - with record prices and 5%+ mortgage interest rates - thereâll always be a supply of renters. Theyâve been priced out of buying at the moment, but still have the cash to populate big urban cores and hot Sunbelt markets. This is why we still like high-end apartment REITs (real estate investment trusts) on the weakness theyâve experienced over the last month. Source: Google Finance The long-term narratives we outlined for Essex Property Trust (ESS), Equity Residential (EQR) and Avalon Bay (AVB) in [the March 29th edition of The Juice]( as well as Camden Property Trust (CPT) on [April 27th]( remain intact. All four REITs carry [dividend yields]( of around 3% and focus their rental portfolios in major urban cores (ESS, EQR, AVB) as well as the hottest Sunbelt real estate markets (AVB, CPT). Sponsored [Closing Soon: Invest in NowRx by May 20th.]( NowRx is reinventing retail pharmacy with proprietary tech that enables amazing service and free same-day prescription delivery. Operating at a fraction of the cost of traditional pharmacies, NowRx has generated over $32.3M in annualized revenue and is preparing for nationwide expansion. Funding round closes May 20th. [Invest in NowRx]( Housing Rent An Apartment Or Buy A Home? Key Takeaways: - Whether youâre looking to buy or rent, itâs a crazy real estate market.
- While some prospective homeowners are rushing to get a mortgage, others arenât in such sound financial positions.
- If youâre of modest means, think about how being house rich/cash poor might make you feel as you ponder the age old rent or own question. Source: [Redfin]( If thatâs not enough to scare off at least some prospective homebuyers, we donât know what is. Between record prices and interest rates firmly situated above 5%, it costs a lot to carry a mortgage. Letâs piece that together with some other data: - Pending home sales dropped 6% in the four weeks leading up to May 8th. Thatâs the biggest annual decrease since June 2020.
- Thereâs a bidding war happening on rentals. For example, in Los Angeles, renters going 10% over asking is common. In some cases, rentals are going for 1.5x the advertised rent.
- In Austin, amid low inventory, rentals went for 35% above asking, on average, in Q1. In most major markets, it takes longer to âbreak evenâ on a home purchase than it did pre-pandemic. Break even meaning, according to the [Wall Street Journal](, âwhen the estimated net costs of having owned that home match the estimated costs of having rented a typical home over the same period.â For example, in Austin the average homebuyer hit break even in 3.7 years pre-pandemic versus the present 5.6 years. Rushing To Pay More For A Mortgage? As with inflation, you might only agonize over the decision to buy a home if the increased costs represent a meaningful hit to your pocketbook. Itâs not that people earning high incomes and presumably sitting on meaningful amounts of cash donât care about paying more. Itâs that theyâre apparently rushing to buy in todayâs environment in anticipation of even higher home prices and mortgage rates. Proof of this - even as demand falls, the average home only stays on the market for 15 days. Thatâs an all-time record. But not everybody has the personal financial luxury of going this route. They must ask other questions. House Rich Or Cash Poor? Setting all of this record-setting data aside, prospective homebuyers of modest means almost always have to ask themselves if they can handle the upfront and ongoing costs of home ownership, irrespective of if and when their investment will become profitable. Can you afford to put 10% or 20% down on a home? Depending on where you want to buy, that number can reach six figures. Do you even have that kind of cash saved? If not, you might be priced out of the market before you even started. At the same time, can you cover not only elevated monthly payments, but property tax (for example, property tax will run you about $1,000 a month on a home around the median in Downtown Austin), closing costs and planned as well as unplanned maintenance? Will you feel cash secure if you find yourself in an all too typical house rich, cash poor situation? Shocker: The TRUE Inflation Rate Isâ¯â¦: The government says the inflation rate is 8.5%, which is already bad enough. But, if you calculate inflation the way the government did in 1980, it's actually 17%. The impact on the average retiree is shocking: They lose an estimated $584,000 in purchasing power. Fortunately, there are some very simple and powerful ways to turn the tables on this crisis and transform it into a wealth-building opportunity unlike anything seen in over four decades. [Watch this to learn how.]( [Ad] *This is sponsored advertising content The Bottom Line: History shows that real estate has been one of the best investments you can make. However, for many people, a home represents a place to live - forever. If this is you, and you donât exactly have a ton of money saved and coming in, the question of home ownership comes down to cash security. Will the costs of home ownership, particularly in todayâs environment, turn the screws on your monthly budget, resulting in cutbacks on needs and wants not associated with your property purchase? On-paper profits (house rich) donât mean much if you donât intend to sell. And, even if you do, you still need a place to live. All of these factors matter as you decide whether to rent or jump into this insane housing market. News & Insights Freshly Squeezed - [SEC Chair Warns Of Crypto Risks As Prices Drop](
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1325 Avenue of the Americas, Floor 27 & 28 New York, New York 10019 Disclaimer: This is not investment advice. This InvestingChannel, Inc. newsletter is for information purposes only and opinion-based. Futures, forex, stock, and options trading are not appropriate for all investors. There is a substantial risk of loss associated with trading these markets. Losses can and will occur. No system or methodology has ever been developed that can ensure returns or against losses. No representation or implication is being made that using any of these methodologies or systems will generate returns or ensure against losses. Investors should be cautious about any and all investments and are advised to conduct their own due diligence prior to making any investment decisions. [Link](