Bad time to invest in Multifamily?
Solely thinking about government regulation in this post. First we had eviction moratorium which I believe was finally repealed around a month ago. But I feel like that set a precedent for the future. Now I'm thinking about how blackrock, zillow, and who knows who else are buying up homes all over the US and driving up prices. Will this eventually cause the gov't to step in to protect citizens? I know single family homes are different from multifamily but just wanted to see if I'm way off on my thinking here that gov't reg would decrease valuations.
I believe political risk is the biggest risk to multifamily. However, many states (like CA) are starting to wake up to the fact that the housing crisis is a supply issue (CA recently ended single family zoning). Of course, a glut of new supply is always a risk to any investment, but it makes me confident that states/munis will likely not resort to draconian rent control, or investor controls, etc. Also keep in mind, housing policy is very fragmented. A state like Florida is very unlikely to impose restrictions on property ownership rights, vs a state like Illinois. Add political risk to your checkbox of factors to assess when acquiring a site.
This is helpful, thanks. Are most, if not all, states in the Northeast high political risk? Living in nyc right now and wanted to invest somewhere within driving distance (up to ~8 hrs away)
I mean it's really tough to say, as I said housing policy is very fragmented. Upstate NY is probably much lower risk than NYC, but there's always the chance that there is a measure on the state level that negates that dynamic.
Makes sense. I'm trying to stay out of nyc as there's so much competition. I'd much rather go to a smaller town upstate or CT or PA or something.
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