There are many different ways to define “core” in terms of property type and location. And every investor and investment manager has his or her own acceptable measure of what “core” means and how it results in an informed investment decision.
Research then takes on a vital role in proving results, whether positive or negative, as well as predicting how well a planned strategy will ultimately turn out. And one of the hardest aspects of research is finding the right data to use in making these strategies and decisions. There are certainly the well-known and highly well-worn data providers that, when properly utilized, give a certain seal of approval that investors are seeking.
But what about the lesser known data and surveys that are often overlooked and very often are more reliable predictive indicators? For example, one of the most unscientific surveys for presidential elections is the one that predicts the outcome based on which candidate’s Halloween mask is the most purchased during the year of an election. This method has accurately predicted the correct winner since 1980, when Ronald Reagan soundly defeated Jimmy Carter.
And this brings us back to the concept of finding “core” or at least finding the next potential hot area for investment as well as finding the cold spots. Now in its 38th year, United Van Lines just released its “Annual National Movers Survey,” which essentially indicates which states in the lower 48 have the most inbound and outbound moving patterns [1]. Not surprisingly, Oregon leads this, followed by South Carolina and North Carolina with New York state, New Jersey and Connecticut at the bottom of the list. Many in the Northeast have cited retirement as a reason for leaving, and these statistics are less than scientific, but they do tell a story which is worth considering.
In essence, sometimes it is worth looking for the less than popular written narrative that can help one find information to either back up an investment strategy or, even more importantly, steer away from one that has a faulty underlying premise.
To that end, it might be worth taking a look at the United Van Lines report and see how it stacks up against your own considered strategies.
1. United Van Lines has tracked migration patterns annually on a state-by-state basis since 1977. For 2014, the study is based on household moves handled by United within the 48 contiguous states and Washington, D.C. United Van Lines classifies states as “high inbound” if 55 percent or more of the moves are going into a state, “high outbound” if 55 percent or more moves were coming out of a state, or “balanced” if the difference between inbound and outbound is negligible.
Not a subscriber to IREI Insights blog? Sign up to receive alerts on new blog posts.
Jonathan Schein is senior vice president and managing director of global business development at Institutional Real Estate, Inc.
