BiggerPockets’ Dave Meyer on What’s Working for Real Estate Investors in 2023

Welcome to the Top of Mind podcast from Altos Research. This is the show where we talk to real estate industry insiders and experts about the trends shaping the market today. Enjoy the show.

(00:18)
Mike Simonson here. Thanks for joining me today. Welcome to the Top of Mind podcast. You know, for three years now, we've been sharing the latest market data every week in our weekly Altos Research video series with the Top of Mind podcast. We're looking to add context to the discussion about what's happening in the market from leaders in the industry. Every week, of course, Altos research tracks every home for sale in the country. We track all the pricing, all the changes in net data, all the supply and demand, and we make it available to you before you see it in the traditional channels. People desperately need to know what's happening in the housing market right now. It was frozen so solid last year, and now suddenly the landscape's changing again. So if you need to communicate about the housing market to your clients, your buyers and sellers, go to altos research.com and just book a free consult with our team.

(01:11)
We'll look at local market. We can talk about how to use market data in your business. And speaking of using market data in your business, I've got my, my terrific guest today, Dave Meyer. Dave is the VP of Data and Analytics at Bigger Pockets. Bigger Pockets is a leading real estate community media network, two and a half million members in the investing space. It's a real big operation content and I love the the work that you guys do over there. So Dave is the host of the On the Market podcast and he's a longtime real estate investor. So we're gonna talk about all of the trends in investing and you know, the bigger pockets audiences a lot as individual investors. So we're gonna take a take a lot of that view today. So Dave, welcome to the show.

Thank you so much, Mike. I appreciate it.

That's great. Let's let's start with your background. How, how did you get into this business and into this spot right here?

I guess it started because I have been investing for about 13 years. I graduated college in 2009, which was not a great job market back then. And I was waiting tables and I actually really liked that. But had a friend that I was skiing with. I think you're a skier, right, Mike? I am,

(02:32)
Yeah. So I had moved out to Colorado. I was skiing a lot and I was driving up to go skiing with a buddy of mine who was definitely not my smartest friend and he was like, I bought this property with my girlfriend and it's cash flowing and making all this money. And I was like, if this idiot could do it, I could definitely do it. <laugh>. And so I I found some partners and was able to get my first deal, which was fortunate cuz I had no money, but I was able to find some people who could me take down a, a fourplex in Denver. and I just loved it. I was really interested in it and I was doing, you know, all the fixing the toilets and windows and all that stuff and I still just really enjoyed it.

(03:12)
at the same time I've always been interested in data and got a master's degree in business analytics and about seven or eight years ago I was like, I really want to merge my two passions, which are data and real estate. And so I just like started googling real estate software companies and bigger pockets was about a mile away from the house I was living in. And I knew nothing about it at the time, but you know, it's a huge, as you said, you know, now we have 2.5 million members. It's grown really rapidly as a resource for really like retail investors. and so now I get to help other people like myself use data to make informed investing decisions

That's awesome. We like making, we like using the data to make informed decisions. tell me more about bigger pockets though. So two and a half million members and it's like content, I think it started as like a blog, right? From Josh Tokin?

Oh yeah, it was actually, I think it might have been a forum first. and Josh has some funny stories about how he like seeded the forums by like answering his own questions for like years and stuff just to make it seem like stuff was going on. but then it became a blog and then a very successful podcast. And now we have all sorts of tools like calculators that can help people understand which deals are good for them. we have all sorts of education that helps people really, wherever you're starting from, even if you've ne barely heard of real estate investing up until people who have massive portfolios, we try and have tools and value to anyone who wants to improve their financial situation through real estate investing.

That's, yeah, and, and the, the bigger, the bigger pocket's name is always really great at capturing that. Like this is about people who use real estate to build their wealth over time. I like that branding a lot on the market is your podcast that you host there which also is great branding like, oh, that I was, I read like, oh, that's what I should have called this one. You know, <laugh>

<laugh>. Oh man. If you knew how many names we cycled through before settling on that one, but I think we got a good one.

<laugh>. That's great. Yeah, it is. Good. And you did a, you did an episode the other day that I was listening to where you have new real estate investors who were like sharing their deals and asking people. There's a, you had a panel of three or four of you who've done a lot of deals and, and you were kind of evaluating it on the fly. Tell me about that.

Yeah, so on the market similar to your show, Mike, we, we try and help people just stay on top of current market conditions and a lot of times that is a more technical analysis of data and talking about economics. But recently we've been trying to help people understand what deals for real estate investors are working right now. And I'm, we've done a few of them now, depending on which one you listen to, some of them work, some of them don't <laugh>. and so we try and help people, I think equally important as identifying good deals is staying away from bad ones. and so we've really been doing those types of analysis and I think the, the show is fun cuz, and, and the reason I love hosting it is we have a panel a lot of the time where it's four or five experienced investors, all very fun, knowledgeable people who come out and just help break down situations and share what they're seeing on this, you know, you know, in their businesses. Cuz I'm, I approach this, I do invest, but I, you know, work full-time at bigger pockets and take more of this academic approach to understanding the markets. But they're out there doing this every single day. So I think we, we try and strike a good balance of you know, helping people understand economics and then interpreting to that, like, what does that mean you should actually do today with your business based on that economic news.

Yeah. And, and so what is working right now? It's a fascinating time. We went from, if you could get your hands on a property, it's, you know, at 2.8%, like it's gonna be great <laugh>, but you couldn't get your hands on it to a very different world. Now what, so what works right now? Like what are investors buying? It's

A great question. In terms of residential real estate, I think there are a couple of tactics that tend to work in almost any market. We call something house hacking, which is basically like an owner-occupied investment. you live in one unit, you rent out the other ones. that, that always seems to do pretty well. I say that rental properties also work in any market, if you can find them. Deals are hard to come by, but they're becoming easier. They're, they're getting easier to find and that, that sort of happens in a correcting environment where sellers are for the most part holding firm, but there are some people who are willing to negotiate right now and you are able to find some more reasonable deals. and surprisingly flipping is still working really well for experienced operators because Mike, you're probably familiar with this, but a lot of times in a correction like this you find that distressed assets fall further proportionally than stabilized high quality properties. but the high pro quality properties are not going down as much as at least I thought they would. And so the spread between what, like a flipper could buy a property for and sell it for has actually increased a lot. And labor and material costs have been coming down a little bit over the last couple of months. So surprisingly it works well, but it's not like if you're a new investor, I wouldn't start flipping right now. I think just for experienced investors, it's actually doing pretty good these days

That, so a new investor, you wouldn't do it because it's actually still pretty hard to identify the right ones. Totally. But, but when you can, the spread's actually increasing now.

Yeah. That, that's what some of our data saying and what our, our experiences are telling people. That depends on the market, right? You know, there are some markets that are declining rapidly right now. I wouldn't, I wouldn't say that, but if you look on the east coast and the southeast, there's still some good prop, you know markets where prices are at least stable. and that's still a pretty decent market to flip into. all that said I, I don't know how much Mike you get into the commercial real estate space here, but that's the one I, I feel is the riskiest right now. And although I invest in commercial and have this year I think that has a little bit more risk and would caution new investors to sort of stay away from right now.

Yeah, the, the anything besides any office space besides a class or even a plus is really scary. And I mean, I live in San Francisco and we have a decade of churn to work through in this and change this, this market over because there's vast amounts of space that are, are not nobody's ever going back to 'em, it feels like.

Yeah, it's, it's wild. It's gonna be really a different environment for, for office. I even think, you know, retail is bounced back a bit, but I think it's gonna be interesting to see the long term, what happens with retail and even multi-family commercial assets. they are a little bit more stable than office, but generally speaking they are not attractive <laugh> right now in terms of the yields that they offer compared to other asset classes out there. And I personally think prices have to come down in the multi-family space as well. So I still invest in them cuz like if you find good deals under market value or you can do value add kind of projects, those are always good. but again, this, this market is, these types of corrections always for investors have risk and reward. and it's, that's why I caution people who are new, not to stay away from it, but to stick to more sort of the easier strategies like rental property investing and away from flipping and commercial because it's risky. Those are inherently risky strategies for investors. And doing a risky thing in a risky environment for a new investor is probably not ideal. That's

Probably not great. Yeah. it's a, it's a fast way to a bunch of lessons. <laugh>.

Yeah, you could learn a lot. That's, that's San Francisco mentality, right? Fail fast, fail often kind of thing.

You, you mentioned that you think that multi-family prices still have a lot to come down and you're thinking like multi-family, like bigger than four unit or, yes. Yeah. And, and why do you say that that still has a lot to come down?

So I think that yes, anything over four units has a bit of risk. One, the type of financing that is available for those types of units tends to be more adjustable rates. And so anyone who's got adjustable rate coming due anytime soon is going to see a big production in their cash flow cuz they're gonna be paying more for debt service. that doesn't necessarily mean prices will come down, but you could find some distress to operators because of that and some forced selling. but I think the main thing is that cap rates, which is how these assets are valued, are just too low. And for anyone listening to this, if you're not familiar, cap rates are just basically a measure of market sentiment when they're low. it's expensive for buyers, it's good for sellers when they're high. It's good for buyers and bad for sellers.

(13:20)
And cap rates are extremely low right now on a national basis. and when you look at how the yield on a multi-family, like if you go and buy an a class multi-family space, your cash flow might be, you know, 4%, 5%, but at the meantime you could buy a US government bond and get 4% <laugh>. So like why would you buy multi-family assets with risky debt you know, complex operations to get the same yield that you can with a risk-free asset. It just doesn't really make sense to me. and of course there's the argument that if you could raise rents and boost your income, then that would push prices up. And that is true, but I'm of the belief that rent growth is a little bit petered out. I think we've had like a lot of pull forward over the last few years and although it's still up, I think it's really gonna come back down to the growth rate is going to come back down to earth.

(14:20)
We're already seeing multi-family rents start to come down in a lot of markets. We as of today, there's some data that came out that said there's more multi-family construct units under construction now than any time in history. So I think there's just like these, these confluence of variables coming together that make it unlikely that these valuations can be sustained. But at the same time, sellers are just not having it. Like, I I think like the reckoning has not come people are not willing to lower their prices yet. So I could be wrong, but I think over the next like six to 12 months, my bet would be that it's gonna, we're gonna see, you know, a 10, 15% decline in in multi-family values.

That's a great prediction. I love that it's precise and, and I love that you have your, your reasoning behind it. reckoning still to come. So 10 to 15%

<laugh>. Yeah, we'll see.

So, so this is interesting though. So you mentioned cap rates and rent growth. Is there a, like a national number? How do you measure cap rates across the country? What do you do for that?

so I actually use CoStar. I don't know if you're familiar. they, they provide some national and regional cap rate information. I think right now there's somewhere between five and 5.5%. and the reason I am saying that I think it will be like a 15 ish 10, 15% is I think like a hundred basis point increase in cap rates could happen. that could be even more closer to a 20% if it's a hundred basis point. So just the way the math works out. So that's sort of what I'm basing it on, you know, as you know, Mike, the economy is very strange. It's very hard to predict right now, but that where we sit in mid-April right now is what I think is the most likely outcome.

Yeah. Do you, are there other stats, other data points that you use that you use to understand for yourself or that you use to help communicate to your community? Like what should people be paying attention to right now?

Well, I, I'm a big fan of what you look at Mike or what you focus on, which is like what's happening in your market today. because you know, the stats I've cited so far are national level, which is fun for us to talk about, but like in terms of buying stuff, it's almost useless <laugh>. it's not useless. It is helpful, but it doesn't help you pick what property you should be looking at or how aggressively to offer on a, on a, on a property. To me, I, I've been really trying to help people understand you know, the importance of inventory days on market and really just trying to understand the supply and demand dynamics in, in your local market because it is an old and, you know, well worn trope and real estate, but location obviously really matters. And there it's different everywhere. and the more a localized your understanding of the data, the the better it is. So I'm just plugging your, your data and your podcast for you, but <laugh>, I really believe it. I think it is extremely important. I pay very close attention to it myself.

I love that, I appreciate that very much. are there, is there data that you have at bigger pockets that you see that other people don't get to see? What do you have there?

Yeah, so we're, we're in the midst of developing that. I think right now what we get a lot of is investors sentiment which isn't really readily available. you know, you can hear a lot about builder sentiment, for example, that's everywhere. and even you get a little bit more information from lenders on institutional investors. But the thing that I think a lot of people get wrong about the real estate investing landscape is that the majority of real estate investors are people own one or two units. you know, 90% of rental units are owned by someone who own, people who have 10 units are less and the majority of them have one or two. and so those folks are really concentrated on bigger pockets. And so I think we have a pretty good sense of like how those people are operating. so that's really interesting. And then we do get a good idea of like what locations they're kind of interested in because we have calculators, for example, that show, you know, where they can analyze deals and we connect people with agents. And so we have a good sense of where people are interested investing. If you follow the housing market, I don't think you would be surprised by the locations they're interested in.

So do you, so investor sentiment could be really in insightful and like a a well-structured survey could be like repeated each week or each month, like could be really cool. I had have, I have lots of ideas on how you might structure that, so let's

Do it. I would love to do that. That would be super cool.

That would be super cool. Do you have a, a gut feel right now about investor sentiment? Like what a weird time. Right. you know, we know that transactions buyers slow down way down last year we know that the big Wall Street money stopped almost completely. What about your side, the vast bulk of investors in this country, the smaller and the retail investors, what are they doing right now?

I think it's split. It, it's a tough time to get into it. So I think, you know, people who have been interested and want to start investing, that has slowed down a bit, but not, not entirely. I think this, this strategy I was talking about with house hacking is really popular because for a lot of reasons, but it is particularly popular when rents are high and really effective when rents are high as they are now, because it really helps you offset your living expenses in a, your personal living expenses in a really meaningful way. And so even for new investors, house hacking is always a pretty good idea, but for people who are like, you know, the craze of jumping into short term rentals and thinking you're gonna earn a 20% on cash return is, is I think over, which is good. I don't, I don't, there was like a lot of hysteria there.

(20:52)
so I think like it's more measured for newbies which is great. I think I recommend to anyone who wants to get into real estate investing, pick like a boring easy strategy to get started, learn as much as you can on a low risk approach. and there still are those types of low risk approach rental properties work in almost every market. House hacking works in almost any market. in terms of more experienced investors, I think like all of my friends who like run big, you know, real estate investing operations are just as active or more active than ever because I think they're enjoying the lack of competition that they have been struggling against over the last couple of years. And these are people, you know, who, you know, we call them retail, but they have you know, a couple dozen properties, not like, you know, two or three.

(21:47)
they're not institutional. They, they're entrepreneurs, like they don't, they run their own businesses. but they are super active because they are really good at finding good deals and there are good deals right now there's a lot of garbage for sure. But, you know, if you're patient and have the systems in place to be able to spot good opportunities there are definitely good deals right now. And I think the overwhelming sentiment is like, if you can find a deal that pencils right now, no one knows, but probably rates will go down within the next couple of years and that will improve your cash flow. that's risky. I wouldn't, I wouldn't make an investment betting on that, but if it pencils right now, that gives you some upside. So I think people are sort of like seeing it that way. and so I I think like sentiment is better than I thought it would be, to be honest.

Yeah. That me too, in fact. and I think a couple of those points are really interesting. I, the first house I bought in Chicago in the mid nineties, you know, was, was it too flat? And I, that was house hacking and, and I promptly moved to San Francisco and got rid of that one. But had I stayed in Chicago at the time, I'm sure I would have a, you know, just moved to a nicer one of those and do it again kind of process. And it would've built a, a ton of wealth over the years. and so like, I, I understand that and, and I also know, you know, the adu process with a lot of states and a lot of, and you know, Airbnb has really unlocked revenue for homeowners that didn't exist 10 years ago.

Absolutely. I, I'm a big fan of it. I think Upzoning is like one of the better solutions to the really high rents, high housing prices that we have in the us. the whole state of Washington is being Upzoned Colorado, where I primarily invest is considering a lot of upzoning and that term just basically means turning, you know, single family zoning into slightly more favorable zoning where you can add a second unit or a detached adu. and yeah, I think it's a really good option. you know, I was talking to an investor friend in Washington who said he was gonna pass on this, this flip he was gonna do, it was okay, but it wasn't great. And, you know, he decided to build an ADU and he is getting, you know, a, a, a really, really strong return now. and this has been available for a year or two, but it was so hard to get materials and labor over the last few years that it made it a diff a a risky proposition. But I think now people are embracing it more because they're just able to build them faster, more predictably. and there's a lot of like prefab options for ADUs now that are really good. so I, I totally agree. I think that's a great option these days.

That's cool. Let's talk about short term rentals and that trend. I was in Nashville last fall and you know, a group of us, we had a h we got a house in in Nashville pretty close to downtown, and like the whole neighborhood were Airbnb units and, and it was wild, like you could tell because they all had like the same like $15 sign that said Nashville on like the <laugh> on the wall,

Right? It was like, yeah, the string lights and stuff. Exactly

Like lighted up sign and yeah. And they all had a little roof decks and all the like, you know, and but I was like, man, that seems like that can't last. Is there a bust coming there? Like are those people toast or is there, what, what do we know?

I, I think it, I can't rule it out. I'll say that <laugh>. So I, I'll be honest, I own one that is not like my primary form of investing, but I think it's an interesting business model. My sense is that like any new business, there's sort of a gold rush and there was this golden time where, you know, four or five years ago you could buy a lot of property, turned into an Airbnb, there was little competition, the cash flow was great. you know, and it was awesome for a while. I think it swung too far in the opposite direction, especially during the pandemic where people were turning really not great properties into Airbnbs people who really don't necessarily want to be in the hospitality business. And that's what it is. It's not real estate investing, you know, you have to care about your guests.

(26:31)
Like if you want to be successful at it, you need to treat it like a business. And I think a lot of people are like, oh, it's easy money and it's not. It's, it's work just like every other, every other business. and so I think there is a in store we saw I think new listings for Airbnb, like new supplies up like 25% year over year I think. So it's big, especially at a time if there's a recession where, you know, discretionary spending could be coming down. and so I think there's like this interesting dynamic where we could see a decline in demand at a time where supply is peaking which will probably hurt revenue for the overall short-term rental industry. People who are good operators are gonna be fine, you know, if people still travel and if you have great high quality products, you know, where people have a great experience, you're probably gonna be fine. I do think it will might weed out some of the people who are not really serious about it in the first place and are probably not as focused on the customer guest experience as they should be.

Yeah. The and you can imagine some of the house hackers, maybe they just don't have quite as much cash flow from the property, but they'll, they'll be just fine. I didn't realize the growth was that big, like 25%.

It's crazy. Yeah, it, it's pretty big. there's a great data source air d n a, I don't know if you know them, but they, they provide some, some pretty good reporting on it and yeah, I think it will slow down. but there was, especially cuz there's been some financing changes too that make second home mortgages a bit more expensive than they were previously. And I think there's, that's probably intentional. and so I do think there's like a bunch of headwinds. I don't think it's like gonna crash, but you know, just like every business, every market, like it was booming, but at a certain point there's enough, like enough sophisticated competition comes into the market to make it an efficient marketplace. And like I think that's sort of what's happening here is like it need, it's just Yeah,

Yeah, the arbitrage, right?

Yeah. It's just like gonna be a regular old, it's gonna be like rental property investing, which is great still, but it's not gonna be this like, oh my God, you're gonna make so much money and it's so easy kind of thing that people sort of thought it was,

I thought it was. Yeah. let's, then, let's then take that and expand it a little bit. We have created a lot of real estate investors over the last decade in this country. I'll, we've taken eight, 9 million properties and taken 'em out of resale single family homes and put 'em into, into investment properties. What <affirmative> what happens next? What happens in the downturn? like do these, do these folks like panic? Do they, do we finally see some inventory? Like are they gonna unload? Like if, if rents fall and the cost of money stays high, do these, do these have to get sold? What happens next?

Yeah, it's a good question. my gut says no <laugh>, but i, that that's just a gut feeling. I think that most people who bought really up until like the end of 2021 are probably doing pretty well. I mean, they pro, you know, most residential retail investors get fixed debt. You know, it's not like these commercial lenders who are, who have an arm or you know, a balloon payment. Like they have pretty solid long-term debt and rents just went crazy. And so like cash flow is probably pretty good and I would expect that rent would have to fall significantly to put most people in trouble. that's it. I think, you know, like most things, like some people who bought in 2022 are probably gonna you know, find, find themselves in an undesirable position. and, but I don't think it's gonna be the majority of people. you know, we're seeing this even with homeowners aren't selling, you know, they're turning their, their existing homes into rentals because it's so undesirable either to sell or it's just profitable to hold on to them. And so my gut says that people are gonna wait it out just like homeowners are right now. They're not moving, they're not selling. and I just think investors are probably gonna be of a similar mindset.

are there conditions, economic conditions that happen where you as an, as an investor start saying, you know what? I wanna unload a couple of these and take my cash.

personally I did unload a few in 2022 in the beginning but I put it back into real estate, but I I was in, these are in Denver and I just, that market went crazy and I just wanted to reduce risk and put into some safer assets I felt. and that was great. But the Denver market is doing well again right now. So who knows if that was the right decision. for

Six months it felt like a really good decision. Yes. And now it's hard to

<laugh>. Maybe it was, I don't know, <laugh>. Yeah, yeah. but I will say that, you know, one of the things that people in the stock market look at all the time is the yield on a, a risk-free asset, right? When you're looking at bond yields or money market accounts in 4%, I think we're reaching a point where real cashflow is tough to find in a lot of markets and in those markets, like is it worth taking on the expense and operational complexity of a rental property to get a 7% return when you can get four and a half doing nothing? You know, it's like, so I think those are sort of the things that I'm curious to see how they play out over the next few years is like, are other asset classes going to offer cash flow that's similar to real estate? Cuz for the last 10, 15 years, real estate was hands down the best cash flow producing asset in, in the, in the economy. But if that changes, I think that could really sort of change the, the dynamics of the housing work in a way I don't really fully understand, but like that is something I'm curious about.

Yeah, I know for me it's like you know, the last time you, you could get interest in that rate was so long ago. I mean, I didn't have any money, right? I didn't have a job <laugh>. Yeah,

Exactly.

Yes. So all of a sudden you're like, oh, you can get, you buy a treasury buy.

Yeah, it's weird. It's like, what is this weird

<laugh>? so okay, so yes, I think there's a lot that, that we have a lot to learn about. You know, what, what does that mean? You know, we've had part of our buyer demand over the last decade has been investors looking for cash flow and what happens if that goes away? Do we suddenly we've had decreasing inventory over the last 12 years each year, fewer, fewer homes for sale. and does that reverse and we start finally building inventory a little bit each year because we take the, take some investors outta the market because they're put their money in treasuries.

Yeah. Yeah. I think that that could be, and I think especially the institutional investors, it'll be interesting to see, i I I know there are people in the real estate investing world who are sort of worried that they're gonna panic sell. I don't really think that's likely. there probably have fixed debt at like 2% on a lot of stuff, you know, it's even lower than mortgage rates. and so I think they'll be fine, but you know, they're chasing yield. So like if yields are better somewhere else, it, it'll be interesting to see if they stay in the real estate market, if you know the prospect of buying bonds or, you know, once the stock market recovers. If, if real estate returns especially in the commercial space are as low as they are right now I think there's a good chance that money goes elsewhere and that could leave to, to some more inventory which should probably be be a good thing. You know, inventory as you know, is extremely low and it's not, you know, investors obviously like high housing prices, but generally speaking want a functioning housing market and it doesn't feel like we're we're there yet. <laugh>.

Yeah. Yeah. that actually gets to another question I'm interested in, in so, you know, there's a lot of people who think we are expecting panic selling that people unload. I i I could imagine scenarios where that happens, but there hasn't been any evidence of it yet. There's no evidence of it yet. So maybe it happens, but we haven't seen it yet. So maybe it doesn't happen. But my question is, are there things that you think about real estate investing in general or about the market that are either under-emphasized or like the headlines always get wrong that you <laugh> want you, that you like, think the zeitgeist doesn't, doesn't get?

That's so many things <laugh>. I'm trying to think of which ones to say. okay. There's a few things that just come to the top of my mind. as someone who I think, like you as like studied the housing market over the long term it is not that volatile of an asset class like historically. I know in 2008 that changed in a very dramatic way. But if you look, you know, I think a lot of people who have gotten into it or who trade stocks think of this, the housing market, like its the stock market that there's these huge swings in demand and, you know, people can sell quickly and panic sell, like functionally it is very difficult to panic sell in real estate. Like it takes months to quote unquote panic sell something. There's just sort of some breaks on the housing market that don't exist in other asset classes.

(37:17)
And so that's one thing. I think the other thing is that like rents don't typically go down during a recession. they did a little bit in 2008 and his old rent data is not great, but from the data we do have, like it doesn't they go down at least less than housing prices historically. And so I think that is a common misconception I think that people think like, oh, there's a recession, people are gonna stop paying rent, rents are gonna go down. And like for the most part that is overblown. and so although there are many other, those are the two that just jumped to my mind,

That's, yeah. So do you think rents don't typically drop in a recession because people sign longer term leases? Is that what's going on?

I think people just like the, the old adage that like, people need a place to stay is true. and I think like rents don't go up. I, I guess yeah, I, they just historically they've stayed so sticky. I, I don't know the exact reason I'm curious about that myself, but there's also a very limited supply of housing units household formation right now in this market. I, I can't even say historically, but household formation the last few years has been really good. And so even though there is a glut of multi-family inventory coming online, I don't expect to see rents go down more than like a percent or two, especially in the residential space and multi-family. It might be more, but I'd be curious. That's a good question. Like, historically, why that is true. I would have to look into it more.

What do you say residential space? You mean single family? Yeah,

Single family duplexes, that kind of stuff. Like it, they, I don't know, when you look at the data I mean, you know, you, you have all this data, like how do you know how much it went down in like 2 0 8 in that downturn?

you know, it, the I don't have that off the top of my head, but, but you know, there, it was driven by the same factor that was driving house home prices, which is household formation stopped and even, even like reverted, right? So, so it's like rents and purchases are not a, they're not a substitute for each other. They are, people are forming households. Some of 'em are gonna rent and some of 'em are gonna buy, but they are all, they're, they're all, it's like the economy's expanding and it