Friday, January 4, 2019

Stock Market Turmoil Can Be Good for Real Estate

Well 2019 is underway and those that follow the stock market might be a bit nervous. . A bumpy Wall Street however, can be effective at keeping the fed from getting a itchy trigger finger for rate hikes. That bodes well for buyers of real estate. But even deeper than that is the larger picture of real estate investment. Builders and developers require large amounts of capital for the projects they build. Whether it is single family homes by developers like Quail Homes here in Vancouver or the big commercial projects like we see going up on the waterfront. Capital investment is what fuels these projects.

When the stock market has adjustments like we have been seeing over the last few months, money is leaving the equity markets and moving elsewhere. Some of it may be landing in the safety of treasuries or other long term bonds, some may head for precious metals like gold, and some of it inevitably ends up in real estate investment.

Locally our government can help direct some of that massive money movement to land here in Clark County. Streamlining the approval process for desirable projects, particularly those in the Downtown Vancouver area will have a long term benefit to the area. If we don't capture that capital now, it will end up elsewhere.

Despite the savage losses on the Dow and other stock market indices, the economy is still growing and institutional investors are still pushing cash to markets they feel will net them a positive return over the next several years. Real estate has always been a solid long term parking place for cash. There is a large amount of investment capital available right now and local builders and developers need to grab their piece while the 'gettin is good'.

Vancouver is pushing allot of residential units in the downtown, that is all fine and well, but they need to focus on getting premier employers to settle in as well. This helps to provide superior jobs that take our Clark County residents out of the Portland workforce and Oregon's aggressive income tax.

Happy New Year!

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