Investors Turn to Hard Assets

Mortgage rates have all but bottomed to historic lows. During an emergency meeting in mid-March, the Federal Reserve just cut interest rates even further, which should make acquiring homes more affordable to a larger number of first-time buyers and first-time investors. If there ever were a time to enter the home buying market as an occupant or investor, that time is now.

During a global financial crisis, residential real estate is a safe bet as an investor since people will always need quality places to live. However, these unprecedented times have prompted a wave of panic and fear among the investment community right now. As a real estate investor, I have personally experienced other real estate downturns and I know how they can be. The key is to mitigate one’s downside risk and damage during these crises, and ideally position oneself to invest in more properties at lower prices in the future.

Based on a five-year average as of 2019, one million households that form may need a place to live in 2020. There is already a supply shortage of 3.8 million homes in the U.S. market creating a demand that needs to be fulfilled. The Fed has reported that economic fundamentals are strong enough to withstand the threat of the coronavirus.

Job losses and economic uncertainty may force people to continue to rent, which will bode well for real estate investors. Overall, these forces are likely to keep the housing market stable with modest growth in spite of  stock market turmoil and an economic slowdown.

Read full article:  https://www.nreionline.com/investment/investors-turn-safe-haven-us-real-estate-wake-coronavirus