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An Interesting Look At Rental Housing Market Demographics and the Way They May Evolve

The housing market is poised for some of the most surprising change in any market place that we have ever seen. Looking at the root of those changes and how they may play out could prove very interesting.

Did you know that in 1940, the low point of depression era housing home ownership in the United States was only 44%. This percentage rose to almost 70% by 2005 the peak of the recent housing boom. At the same time housing density fell from 3.77% to today’s 2.6% The latter figure means that without adding 175,000,000 people to the U.S., the number of households increased 1/3. The additional 175,000,000 in population provided a tremendous increase added almost 60 million homes and by itself would have doubled the absolute number of home owners.

Fast forward today and consider how the emerging statistics will impact housing. First 72% of new household will be minority owners. That means over 50% of these renters are not expected to rent. Span that fact over additional decade and let’s see where we are. If we add 1.2 million homes per year 840,000 will be rented. On the contrary, only 360,000 will be single family home owners or similar owners for each 12 month period. This implies that each 2 year period home ownership will fall another percentage point. This implies that by the middle of the decade home ownership may have fallen to the high 50% range. Additionally, over two decades potential exists for the percentages to fall near or below 50%.

Add to this already compelling demographic factors and this creates the investors perfect storm with rock solid project rental demand rising at rates never seen. At the same time, construction constraints will tighten the mother further. Emerging Echo Boomers, retiring baby boomers, and cost conscious consumers will make renting the property.a steadily increasing cost business, save your family money, and complete required effort.

Seems like most investors, owners, operators, and others should focus on these demographic factors as this could prove the best real support for investors.

Investors who account for density changes, buys for the future hold, positions to capture leases based on demographic evolution, and many other factors will have the opportunity to win out sized cash returns is positioning to secure the asset, minimize expenses, maximize revenue and consider the outcomes that lie ahead for your investment.

Stock Market Fear And Volatility Factor

What an exciting day yesterday was in the markets. How can I say exciting? Well an extremely volatile day like yesterday is an intraday trader’s haven. However this may be the market place for the proactive intraday trader, but what are thoughts, strategies, and feelings for the average retail swing trader?

Elite Trading & Speculations outlook has not changed, and if you have read our previous essay our strategy is playing out. Tech has had a great run up and we took money off the table; our outlook for tech is the same so we will redeploy capital back into this sector once a correction has been set. Consumer staples had a great day and this was due to reports and analysis suggesting a domestic slowdown, however this is nothing to fear causing you to pull money out of perfectly good stocks.

Fear, this is a huge variable in the markets along with recent volatility levels. Also a lack of knowledge in the financial sector is a great reason we have been experiencing big swings in the market. Traders and investors are missing a piece of the puzzle that would show the current state of the markets. With this situation we have a great amount of speculation, which is not a bad thing for some, but increases fear in some traders and investors. In turn we believe there is a lot of cash sitting on the side line now and this can be a good thing for the future. All of these variables cause these recent huge swings in the markets. There was indication of this yesterday near the end of the trading session. When the financials did a huge reversal, the markets intraday fear and speculation turned as well so this caused the market to turn in parallel with the financials.

Fear is a great variable in which you can use to your advantage. Not your fear of course, but the fear of others. When the market or a stock is selling off and they become undervalued this gives us great entry points and trading set ups. Fear must be controlled to master the market. I say controlled, because you will never eliminate this human factor that is a part of all of us, and anyone who claims they can eliminate fear or just does not feel it is ignorant and will fail in the greatest game on earth.

Remember to look at a stocks fundamentals, and ask yourself is there any new factors in the stock or its sector that will affect the future demand of its services or products. If nothing has changed in variables that determine future outlook and demand from the past during a market uptrend, your stock may be on sale. You must look at the technicals as well. At this point they most likely are broken down. A new down trend is most likely developing. At this point you should look at past support areas and if the downtrend is broken at these areas of support this may be a good entry point. We are not suggesting to pick bottoms, but to deploy capital on the way down in the extreme oversold conditions. If you are a more advance trader options work well in these setups to reduce risk.

Bottom line, in the end supply & demand determines a stock’s price, not fear. It takes time to develop the skill to control your fear and in time you will improve this skill. This important factor of fear will play a part in the determination in one success in the markets.