While COVID-19 is a total black swan event and it is hard to predict its effects, it could be a blessing in disguise for multifamily. Neal Bawa joins us again on the show today, and this time to give us his data-driven insights into the impacts of coronavirus on real estate. Neal is a technologist, data scientist, and self-proclaimed geek. He is the CEO and Founder of the highly successful commercial real estate investment company Grocapitus Investments and is also the CEO of MultifamilyU, an apartment investing education company. A big takeaway from our chat with Neal is about how we only feel the effects of recessions in real estate after a long lag. With COVID things have been slightly different though, and Neal gives us his insights into why we will see rents continue to drop but in the long run, the fact that multifamily is a need-based asset could make it extremely recession-resistant. From there, we hear about what Neal is doing to cover himself for the coming temporary dip, and also hear about a great opportunity this situation has brought in the form of Fannie Mae loans now being available at 2.8% for a 10-year fix. Wrapping up, Neal gives us some of his research-backed perspectives on which markets we should be investing in right now, before we shoot our usual final four questions his way. For valuable insights on the effects of COVID-19 on multifamily, be sure to tune in today!
Key Points From This Episode:
- Neal’s road from tech into real estate and what his current portfolio looks like.
- The impacts of COVID on real estate and why this is a black swan event for the market.
- That the real estate market feels the effects of recessions after a long lag and why.
- Effects of COVID on multifamily specifically: A bright future after a temporary rent growth dip.
- Why multifamily will be the least affected asset class of all because it is need-based.
- Low delinquency rates in multifamily, except for in C-class, because of poverty.
- What might happen once people realize how recession-resistant multifamily is.
- Neal’s strategy to focus on occupancy to get him through the next few months.
- Why the aggressive vaccine strategy happening worldwide gets Neal’s approval.
- The opportunity presented by Fannie Mae loans being available at 2.8% for a 10-year fix.
- Good and bad markets to be investing in according to Neal’s data-driven insights.
- One thing COVID has taught Neal about the unpredictability of black swan events.