Pigs don’t fly and functional multifamily assets seldom trade at a significant discount to replacement costs. Soon after TARP (Troubled Asset Recovery Program) was implemented in 2008 the sharks circled eying bundles of multifamily assets presumed to hit the market at distressed prices… fire sale prices. The sale never happened. Why? ‘Because pigs don’t fly.
Why is it so hard to devalue multifamily assets? One reason is their popularity- the asset class has legs. Thus, even an upside down owner believes to their core that valuations will return “any minute” (note to self; market timing never works- see Gartman Interest Rate Observer) www.grantspub.com.
Read more...Multifamily Devaluation (When Pigs Fly) | Multifamily Insight Blog
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