Providing Education, Resources & Networking Since 1978 Kentucky’s premier investment club for landlords, rehabbers and wholesalers Meeting the 4th Thursday of every month (except November & December) KREIA.COM • facebook.com/groups/kreiaky • twitter.com/reiaky
Monthly Newsletter for KREIA Members
Vol 2-22 February 2022 President’s Letter
1
Main Meeting: Are you ready to file taxes? Pick a CPA’s brain!
3
Welcome, New Members!
4
Workshop News: KREIATREAT is sold out, but Vena is on Zoom Mike Butler: Workshop benefits John Mays: Black History Is American History
6 10
Nina Musgrave: Noise levels can 16 lower asset values – fight back Sharon Vornholt: How to find off- 18 market deals KREIA Photos
20
L.O.T.S. Recap: Highlands make- 24 over with Brad & Kristy Wagner Lauren Willoughby: Flash drives 24 for REI data on the go
National REIA News Briefs
26
Hunter/O’Bryan Scholarship
26
Ian Hooper: Donations for HOI
28
Dear KREIA Members and Friends, Welcome to the year of opportunity! Since the last time we were together, the Federal Reserve has made dramatic changes in the monetary policy that has helped fuel the economy and raise asset prices over the last 12+ years. Some of the possible outcomes of these actions are listed below. Regardless of what happens, Erik Hitzelberger though, increased chaos and volatility is highly likely. This is good news for us as investors. As we discussed a few months ago, “Chaos is a Ladder.” In case you didn’t already know this, the Federal Reserve has a dual mandate in terms of controlling the economy. Chairman Powell and the rest of the Board are tasked with both making sure target employment levels and target inflation rates (2%) are met. For over a decade, these goals have dictated lowering rates and pumping money into the economy through Qualitative Easing (QE). As you are aware, the GDP growth last year (5.9%) was the highest it’s been since 1984, but inflation is well above target levels. Furthermore, labor shortages are creating issues throughout the economy despite employment returning to pre-pandemic levels. Both sides of the Fed’s mandate require a reversal in policy. The Fed announced in the fall that QE would be tapering off over the course of 2022 and we would likely see 1-2 rate hikes. Last month, however, Chairman Powell stated that those plans were not sufficient. QE is now expected to end in March and Quantitative Tightening (QT – taking money out of the economy) is going to begin around the same time. These changes coupled with rate hikes will create the aforementioned volatility. The possible outcomes of the new policies include: Outcome 1: It works: The changes have the desired income of pumping the brakes and both growth and inflation settle into target ranges. Jobs, wages and corporate profits stabilize at new normal rates and the government becomes a little less involved in driving the economy. Woohoo! Continued on Page 32
Illustration by Nina Musgrave
KHA Assistance Fund: Apply to receive up to $35,000 Government Affairs Links
38
Calendar of Events
40
Copyright MMXXII Kentuckiana Real Estate Investors Association • P.O. Box 91225 • Louisville, KY• 40291 (502) 509-2216 www.KREIA.com DISCLAIMER: KREIA does NOT pre-qualify, evaluate, endorse, guarantee or warranty any particular deal, service, company, or person. The Kentuckiana Real Estate Investors Association recommends you perform your own due diligence & seek appropriate legal, accounting, or other professional advice before making any investment. KREIA is a Member of National Real Estate Investors Association.