Boomer's wealth is a ticking time bomb

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S&P 500 Sector Returns During Soft Landings link

• Healthcare, financials, and consumer staples typically outperform when the Fed cuts rates and achieves a soft landing. These sectors saw notable gains in past cycles such as 1995-1996 and 1998.

• The data shows cumulative total returns of each sector during rate cuts that did not overlap with a recession, highlighting defensive investments as key winners. This suggests a pattern where cautious investors prioritize safer sectors in these periods.

• The analysis covers two distinct Fed cut periods where a soft landing was achieved, showing that these sectors consistently outperformed.

Apartment List National Rent Report link

• National median rent dropped 0.5% in September, bringing the current median rent to $1,405. Year-over-year rent growth remains in negative territory at -0.7%, a trend observed for over a year.

• Vacancy rates have risen to 6.7%, reflecting a two-year easing trend as more apartments are being completed, particularly in Sun Belt metros like Austin and Raleigh. With 2024 seeing the highest number of apartment completions in decades, vacancies are likely to remain high.

• Year-over-year rent declines are most pronounced in Sun Belt cities such as Austin (-7.2%), Raleigh (-4.8%), and Jacksonville (-4.3%). In contrast, the Midwest and Northeast, including cities like Cleveland and Hartford, are still experiencing positive rent growth.

Senior living ‘knocking on’ record-high occupancy levels in coming years, propelling investor interest link

• Senior housing occupancy is projected to reach 91% by 2026 across 99 primary and secondary markets, with rapid recovery in assisted living leading the way. This marks a significant absorption rate, with 23 units absorbed for every 10 new ones added to the market.

• Investment firms like AEW Capital Management, which has $3.3 billion in senior housing assets, are prioritizing the sector, seeing it as a top investment opportunity for 2025. The firm’s LPs are showing renewed interest after years of challenges.

• Demand is fueled by the aging population, rising wealth among older adults, and slow new construction. This supply-demand gap is leading to growing operating margins and strong investment appeal.

People increasingly factor natural disasters when deciding where to live link

• Nearly a third of young Americans (18-34) are reconsidering where to move due to natural disasters, with hurricanes like Helene having a strong influence. In contrast, only 15% of those over 35 are similarly concerned.

• Tampa, one of the fastest-growing metropolitan areas in the US, saw more than 51,000 people move in between 2022 and 2023 but now faces significant challenges due to two major hurricanes in quick succession. Rising insurance premiums are adding to the burden for residents.

• Home sales in parts of Florida, particularly Tampa and Orlando, have stagnated, with inventory levels up by more than 50% year-over-year. Institutional investors, concerned about insurance costs, are also retreating from these markets, which may lead to declining home prices.

Updated RealPage forecast indicates strong demand, more mild rent growth link

• The U.S. economy added 254,000 jobs in September, with 1.8 million jobs created so far in 2024, which is 24% lower than the same period last year. Average hourly earnings increased by 4% annually in September, boosting real wages.

• Apartment demand remained robust, absorbing 192,000 units in Q3 2024, bringing the total to over 488,000 units for the year. RealPage expects demand to rise by 5% in 2025, with nearly 600,000 units delivered in 2024.

• Rent forecasts were downgraded in 68% of the top 50 markets for 2024, while 36% of markets will experience rent cuts in Q4. For 2025, nearly half of the top 50 markets will see rent growth between 2% and 3%.

Developers eye opportunities amid multifamily market uncertainty link

• The multifamily development sector is transforming, driven by redevelopment, mixed-use properties, and the growing build-to-rent market. The biggest challenge for developers is deciding where to start amid uncertainties in the market.

• In California, labor shortages and rising housing costs are key factors, with workers commuting long distances, increasing overall construction expenses. Some employees commute from Bakersfield to Los Angeles, which highlights the unsustainability of current trends.

• Optimism persists, particularly in San Diego, where unique supply conditions may open future opportunities. Lower interest rates might encourage more investors, though securing funding for new projects remains a hurdle.

How boomers’ money secrets are a ticking time bomb for their kids link

• Many boomers, like the author’s parents, are facing financial crises but avoid discussing their struggles, leaving their children unprepared. This has created situations where millennials are surprised by hidden debts, such as second mortgages and potential reverse mortgages.

• A 2024 Redfin survey shows 36% of Gen Z and millennials expect help from family to buy a home, yet many are realizing that financial support may not come. In today’s expensive housing market, intergenerational wealth is becoming increasingly necessary.

• Assisted living costs in the US average $4,500 per month, or $54,000 annually, which many boomers are unprepared to cover. Without transparency, millennials may face the double burden of supporting aging parents and their own families.

Floyd Mayweather makes 2nd largest multifamily NYC deal this year link

• Mayweather has acquired a portfolio of over 60 buildings and 1,000 affordable units in Upper Manhattan for $402 million. This marks the second-largest multifamily deal in New York City this year, behind a $672 million Brooklyn deal.

• The seller, Black Spruce Management, was led by founder Josh Gotlib, who sold the properties in a distressed transaction. The deal adds to Mayweather's growing real estate portfolio in New York, where he has been involved in several previous investments.

• New York City accounted for 9.7% of transaction volume in Q2, with investor interest growing due to its resistance to overbuilding. The city led multifamily markets followed by Phoenix, Dallas, Los Angeles, and Washington, D.C.

3 not so well known cities that have skyrocketed in popularity

Population Growth Drives Record Apartment Demand in 7 Markets

Where Are People Working Remotely - NY Times

The 10 Best Big Cities for Older Adults Aged 50 and Up

List of Proptech Startups That Just Got Funded

Which College Degrees Have the Best Return on Investment?

Peoria truly has some beautiful homes.

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Vidit

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