ANSWER

Our goal is to have the best return on investment possible. If there’s a downturn in the economy, we’d want to hold the property until the market improves. In doing so, we’d see a better cash return at sale. However, there are differences between class A and class B/C value add properties. The latter see more stability in price as people still need a roof over their head even during a downturn. Moreover, the market/service economy demographic more often sees continued employment, versus a class A renter in a more lucrative job that may be at greater risk during a downturn. Consequently, a class B or C property is much more likely to hold steady than a class A luxury property when the market takes a dip.

x