@BenMillerise @fundrise We are going into a recession. The Fed is trying to reverse inflating assets by raising interest rates. So stocks and bonds are getting hurt the most because the Fed impacts the economy through financial assets.

@BenMillerise @fundrise In good times, assets price the same (they go up). In bad times, good assets price better than bad assets, which price down. Real estate is starting to bifurcate from stocks and bonds. Why?

@BenMillerise @fundrise Stagflation. We are experiencing high inflation + low or negative growth for the 1st time since the 1970s. In 1970, $1 invested in the stock market was worth $.70 by 1980 (-30%). But $1 invested in real estate in 1970 was worth $3 in 1980 (+300%). (ballpark numbers)

@BenMillerise @fundrise Real assets appreciate because they grow with inflation. Financial assets get squeezed. Their margins get eaten by inflation with low or no price appreciation because of low growth. This is why RE (and other real assets) is one of the best places to be now.

@BenMillerise @fundrise Real estate has inflation protection. A new building or home in 2022 costs a lot more (labor and materials) than in 2019. You can't replace that building anywhere near the cost you could have 3 years ago. If you buy a home at half the replacement cost, you should make $.

@BenMillerise @fundrise Rental housing will continue to do well because of inflation. In a recession, home buying slows and more people rent. Some measurements showed 20% rent growth in 2021 and expect 8% this year (usually 3%).

@BenMillerise @fundrise Which geographies will do well in the next decade? Geography is the biggest asset creator in real estate (location, location, location). It's no longer all about the blue cities like SF and NYC. The growth is in the Sunbelt & Rocky Mountains states.

@BenMillerise @fundrise There are 2 ways to make $ in real estate 1. Picking a great deal (riskier + more difficult) 2. Riding a big wave (If you go sailing, you want the tailwind) The big wave in real estate is: 1. Demographics 2. Globalization 3. Technology

@BenMillerise @fundrise The biggest technology change last decade was e-commerce. E-commerce replaced retail. This drove industrial real estate as we had more logistics and last-mile delivery to bring products to direct to consumer.

@BenMillerise @fundrise The next 10-20 year trend will be residential replacing the office. This trend + people moving to the Sunbelt (Austin, Charlotte, Nashville, etc.) People are moving because you can live wherever when working from home. People are choosing affordability and good weather.

@BenMillerise @fundrise 1st metric when evaluating a deal: Cost basis Price/ Sq ft, Price/house, Price/ unit, etc. Cash-on-cash or interest rate can change a lot but the price you bought can't. The price you buy something at determines the return you get.

@BenMillerise @fundrise More people in tech and crypto are getting into real estate because there is less competition. The smartest people in school didn't go into real estate. The people are easier to compete with than tech, investment banking, medical, etc. Real estate is a meat & potatoes business

@BenMillerise @fundrise In tech, you make 100 investments. You lose on 99 of them. You make $ on 1. In real estate, you make $ on 99 investments. You lose your $ on the last 1. Leverage in RE is different than tech. People lose $ in RE by doubling-down over and over again. (Discipline > smarts)

@BenMillerise @fundrise Ben's 1 lesson from investing in real estate over the years: Always have some cash. The value of your real estate depends on you holding onto it. And that depends on how much liquidity you have. You need cash in case of an emergency.

@BenMillerise @fundrise For someone who wants to get into real estate investing, do these 3 things 1. Learn by doing - the best option 2. Learning thru history - biographies (Blackstone, Goldman Sachs, etc) 3. Read content online

@BenMillerise @fundrise That's a wrap! If you enjoyed this thread: 1. Follow me @BryceWGarcia for more of these 2. RT the tweet below to share this thread with your audience

@ItsDavidLyons @BenMillerise @fundrise It seems crazy to remember that stocks don’t always go up

@BryceWGarcia @BenMillerise @fundrise You should check out actual @fundrise podcast “Onward” for more hot takes and perspective.

@CarlinJamesLee @BenMillerise @fundrise Will do. Thanks for the tip.