RealCrowd’s Thoughts
What’s Happening Now
The big economic news this week was the announcement that the Fed plans to keep rates near zero for at least three years. Their position is firm on holding rates at historic lows until the economy returns to full employment and we see inflation running “moderately” above the 2% goal for “some time.” I’ll let somebody better at reading the tea leaves make a call as to when that will actually be, though some economists are already calling for a four to five year run at these near zero rates.
We also saw the weekly unemployment claims tick in around a seasonally adjusted 860,000 last week, the lowest we’ve seen since March, but still a staggering number. Employers have added back an estimated 11 million of the 22 million jobs lost in March and April, but the pace of recovery has seemed to slow from the earlier rebound. That ties into the report in our articles below showing that 52% of 18-29-year-olds are living with their parents right now.
And since it’s a new week, we should probably mention that Amazon is not only seeking to hire an additional 100,000 workers in its latest plans to continue world domination, but also that they’re opening 100 new distribution centers this month!
What To Watch
It appears there may be new life in the stimulus world as legislators scramble to ink a deal that would provide much needed direct payments prior to the election. However, if you’ve been paying attention, I’ll defer to my comments above about reading those particular tea leaves.
Following up on our newsletter last week, it appears the NMHC rent tracker has come back in line with the prior months numbers, showing rent collections through September 13th holding at 86.2%, down 250bps from the same period in 2019, and well within the band we’ve seen tracking since the beginning of the crisis.
If all of this talk about the economy, stimulus and elections has your head swimming, be sure to sign up for our webinar next week with Jeff Krumpelman, Chief Investment Strategist for Mariner Wealth Advisors, where he’s breaking out the crystal ball to discuss how they see the remainder of this year playing out and what to look for heading into 2021.
-Adam Hooper, CEO
Weekly Metrics
| 2019 | 2020 | |
| Rent Payments Collected by May 13th | 89.8% | 87.7% |
| Rent Payments Collected by June 13th | 88.9% | 89.0% |
| Rent Payments Collected by July 13th | 90.1% | 87.6% |
| Rent Payments Collected by August 13th | 88.9% | 86.9% |
| Rent Payments Collected by September 13th | 88.7% | 86.2% |
| Current | Prior Week Change | |
| 10 Year Treasury | 0.690% | +0.010% |
| DOW | 27,901.98 | +367.40 |
| S&P 500 | 3,357.01 | +17.82 |
| Unemployment Rate | 8.4% | — |
| Total US COVID-19 Cases | 6,688k | +287k |
| Total US COVID-19 Tests | 101.5m | +6.06m |
Live Webinar Next Week
Want to learn where the equities markets are headed?
Then join us on Wednesday, September 23rd at 10am PDT for a special live webinar with Jeff Krumpelman, Chief Investment Strategist at Mariner Wealth Advisors.
Latest Podcast
Exploring The Future Of Real Estate
Steve Weikal, Head of Industry Relations at the MIT Center for Real Estate, joined us on the podcast to discuss the latest research coming out of MIT regarding the future of real estate.
Key Articles To Read This Week
Amazon to hire 100,000 more workers in its latest job spree this year
The world’s biggest online retailer said the positions are for full and part-time work in its home country and Canada.
Pandemic Pushing Gen Z and Millennials to Move Back Home
A huge surge in unemployment sends young adults home to live with their parents.
Home-Flipper Opendoor Going Public in Social Capital Merger
Opendoor is the latest startup to go public through a special purpose acquisition company.
WeWork Looks at the Office Market’s Post-COVID Future
WeWork has worked closely with industry-leading companies worldwide to adapt their workplace strategies and real estate needs in light of the pandemic.
A Million Mortgage Borrowers Fall Through Covid-19 Safety Net
Some homeowners don’t know they qualify for a relief program that allows them to delay payments
Apartment Developers Scout Adaptive Reuse Possibilities
That math will become easier for developers if more distressed properties become available at a steep discount.
Fed Sees Rates Near Zero Through 2023 to Boost Jobs, Prices
Fed on hold until inflation at 2%, set for moderate overshoot
Regus throws 6 NYC locations into bankruptcy
Flex-office company has filed for Chapter 11 on nearly 100 locations across the country
America’s Offices Sit Half-Empty Six Months Into the Covid-19 Pandemic
U.S. stores and factories are getting back to normal occupancy, but offices are lagging
Bruised dollar may bounce if U.S. election gets chaotic
The dollar stands near its lowest level in 16 months after falling more than 9% from its March peak
What will offices look like in the post-pandemic future? This Hollywood space offers a preview
The COVID-19 pandemic has been rough on the office business.
*If you like this post, be sure to enroll in our free six week course on the fundamentals of commercial real estate investing — RealCrowd University.*