How to Bet Against a Recovery Before 2014

Bailout after bailout has been paid to our financial institutions, and it’s just coming out that we are heading for an even deeper recession than originally projected. As a matter of fact, we are much worse off right now than the worse projections designed to scare us if we didn’t vote for the trillions in bailouts. Printing money hand over fist causes strange and dire problems with the economy. If you believe this to be true, keep reading.

The National Association of Realtors published a report outlining the commercial recovery; specifically in the multifamily sector. In the article NAR predicts, “Multifamily vacancies should drop from 5.8% nationally to 4.7% by Q2 2012 and rents should rise 3.4% in 2011 then 4.3% in 2012.”

Why is this happening? Well even the amateur observer of the market would say that homeownership rates soared well beyond where they should have been based on median income and people’s ability to pay the huge mortgages they were getting. Now that these folks have defaulted, they still need a roof over their heads.

Also, many people are waiting out the market to buy. This happens because folks are afraid, and sometimes because people are more transient due to poor job outlooks. The last thing a young family wants to do is tie themselves down with a home they can’t sell knowing that they may need to move in a year or two to find better job prospects.

There are many more reasons behind the rental boom, but one thing is for sure – It’s possible to make money in the rental market again! All of the factors listed above, plus much tighter loan restrictions makes renting more appealing than ever.

The great thing is that the same factors creating a great market in which to own rentals are the same factors driving down prices in single family homes. With rates at historic lows and prices bottoming out, investors have a huge opportunity to create great positive cash flow through rental properties.

We printed trillions in new money and went into great debt to bailout Wall Street. Printing money leads to inflation every time. As we saw in the late 1970s and early 1980s, our government fights inflation by raising interest rates. This is going to make purchasing a home even harder to do. If you want to bet against the current recovery steps initiated by our government, get your money out of the stock market before it crashes, and buy rental properties while it’s still cheap to leverage other people’s money.