Jonathan Christopher

Real-Estate Veteran Sees a Rare Opportunity to Buy Quality REITs - Barron's

If you want to invest in Real Estate, the best bet is actually in apartment rentals, for the following reason:

Housing stock is about 100,000,000 units Annual losses in available stock, due to age, redevelopment, fires, floods, etc are about 750,000 units per year. Now that construction is at about 400,000 units per year, we are actually losing available units at about 350,000 per year. Since people losing their homes still need a place to live, and the population is increasing, perhaps by 300,000 to 500,000 family units per year, we are quickly eating up the surplus.

With an excess of about 2,000,000 units currently on the market, We will eat up the surplus in approximately two years. However the surplus and demand are unevenly distributed. As a result, in relatively tight markets, in growing states (such as my North Carolina), house prices will begin to increase significantly before that two year point. In fact, I would not be surprised to see increases in North Carolina within 6 months.

What have i done? Purchased as many student- housing apartments in NC as possible. During recessions, the young people that cannot get jobs often go back to continue in college to delay the day of reconing.