The economic headlines right now look about as cheerful as a Monday morning before coffee.
Tariffs. Recession talk. Stock portfolios down 10-30% year-to-date. Dow Jones down 2,000 points in one day. And many investors learned the hard way that perhaps they’re not as diversified as they thought.
We’ve been here before – COVID, the dot-com crash, 2008 meltdown. Each felt like the end of the world as we knew it. But one theme held true in every crisis: “This too shall pass.”
Markets adapted, economies adjusted, and investors who kept their heads came out ahead.
So what’s the answer this time? For one, it’s probably not stuffing your mattress with cash. It’s also probably not feeling sorry for yourself.
Instead, it’s picking yourself up by your bootstraps, understanding that things are cyclical and that different economic climates call for different investment strategies.
Five Stand-Out Investments in Recessions & Disruptive Cycles
Smart investors know better than to run for the hills when markets get shaky and economic storm clouds gather. That’s because the most volatile markets often create the best buying opportunities. Sometimes generational ones, at that.
While you can absolutely invest in many different types of assets during downturns, the assets that thrive in uncertainty share some common traits: steady income, hedging against inflation, resilience against volatility, and connection to essential needs.
- Multifamily Real Estate (Especially Workforce Housing): People always need a place to live, and when homeownership gets expensive, renters increase. Focus on workforce housing (apartments for regular working people), and you’ll see strong cash flow regardless of what the stock market’s doing. Bonus: these properties often appreciate even when other real estate gets hammered.
- Dividend-Paying Stocks (Defensive Sectors): Think healthcare, utilities, and consumer staples – the stuff people can’t live without. These sectors keep churning profits and paying dividends when growth stocks are busy tanking. Your grandpa’s old stock portfolio probably had some of these, and for good reason.
- Precious Metals (Gold, Silver): Gold and silver have been safe havens for thousands of years. When paper money loses trust and markets panic, these shiny metals tend to shine brighter. They might not pay dividends but hold value when other assets are busy imploding.
- U.S. Treasury Bonds (Short- to Mid-Term): These bonds get more valuable when interest rates drop (usually during recessions). Stick to short- to mid-term maturities to avoid getting locked into low rates for decades. Unless you think the U.S. government is going out of business, they’re about as safe as investments get.
- Commodities/ Inflation Hedges: Food, energy, and Treasury Inflation-Protected Securities (TIPS) often outperform when inflation heats up during economic slowdowns. People need to eat and fill their gas tanks regardless of what the economy’s doing, making these investments resilient against two of recession’s favorite companions: inflation and uncertainty.
7 Reasons Why Multifamily Outperforms When the Economy Under-Performs
So, in uncertain economic times, where should you put your money?
Whether you trust AI or not, we actually asked ChatGPT this very same question, and you know what? It consistently ranked multifamily real estate at the top.
Frankly, that’s exactly what we’d expect—and the robots aren’t the only ones saying it. Real investors and market experts have been beating this same drum for years, largely because multifamily offers what few investments can: reliable monthly cash flow paired with solid long-term appreciation.
History keeps proving this point. Through the dot-com crash, the 2008 financial meltdown, and even when COVID turned markets upside down—multifamily didn’t just survive; it outperformed. While other investments crumbled, apartments kept delivering.
And in today’s climate, workforce housing looks particularly attractive within the multifamily sector as more people put off buying homes or need to downsize.
- Housing Is a Non-Discretionary Need
Everyone needs a roof over their head, period. About 31.4% to 34.3% of U.S. households rent their homes – roughly 102.7 million people who need to pay rent each month. Housing sits in the category of “four walls” expenses alongside food, utilities, and transportation – the stuff you’d still pay even if your income got cut in half tomorrow.
Unlike shopping malls or fancy office buildings that can turn into ghost towns overnight, rental housing demand never drops to zero. Class B/C affordable housing strengthens during tough times because affordability becomes a survival skill.
- Counter-Cyclical Demand Dynamics
Economic downturns do something interesting: they push buyers back into the rental pool faster than geese flying south for winter. Lenders get pickier, jobs become shakier, and suddenly that suburban dream doesn’t look as cozy. Smaller apartments start looking pretty good when the alternative is financial stress.
The rental market showed exactly this pattern in 2024 when rental households grew by 848,000 – that’s 1.9% growth, hitting a record 45.3 million renter households and the fastest pace of rental household growth in a decade (excluding the pandemic).
Compared to homeowner growth, renters are increasing more than twice as fast. Not shocking- buying a home now costs $1,091 more per month than renting, and home prices sit over 40% above pre-pandemic levels.
- Consistent Cash Flow + Long-Term Appreciation
Multifamily offers the holy grail of investing: income today plus value tomorrow. Monthly rent checks keep rolling in while your property value climbs – it’s the financial equivalent of having your cake and eating it, too. Even when markets go wild, well-managed properties with conservative financing keep paying out cash flow like clockwork.
Since the stock market crashed, multifamily rents have kept growing, and our RSN portfolio’s financials keep improving. History shows rents creeping upward over the last 100+ years without taking recession-sized dips. That’s stability you can bank on.
- Inflation Hedge via Short Lease Cycles
Unlike office or retail leases stretched over multiple years, multifamily leases flip every 12 months. While this short duration has pros and cons, the biggest pro in uncertain times is that it gives owners the power to adjust rents with inflation, pivot to market changes, and squeeze in extra revenue through fees.
Think of it as having a business where you can reset prices annually instead of being locked into a multi-year contract.
Case in point: despite massive new supply in 2025, projections see multifamily rents still showing 2.2% growth and outpacing many office and retail assets locked into longer leases. When half the top 100 metro areas saw rent drops in 2024, smart operators shifted gears with renewal incentives and creative fee structures. Today, about 65% of operators charge extra for services like package lockers, parking, and premium amenities – all adjustable when leases renew.
- Real Asset Protection Against Currency & Market Risk
In times of economic or currency uncertainty, real assets like multifamily real estate are tangible stores of value. Unlike paper assets that can evaporate, even to zero, apartment buildings stay put. Global investors figured this out long ago.
Multifamily topped the charts as the most preferred commercial real estate class in 2025. Over the past decade, international capital (especially Canadian investors) dumped $184 billion into U.S. multifamily. While other sectors struggle with oversupply and distressed loans, apartment demand stays rock solid.
- Tax Efficiency Enhances Net Returns
Real estate has built-in tax advantages that matter a whole lot when times get tough. Depreciation lets property owners claim paper losses against profits – even when the property’s appreciating. Cost segregation helps speed up these deductions, while 1031 exchanges let investors defer capital gains taxes by rolling money into new properties. These tax breaks lower bills and keep cash distributions flowing to investors, especially when other investments start losing value.
- Control & Value Creation Through Operations
Last but not least, multifamily lets you create value with your own two hands (or your property manager’s). Unit upgrades, amenity improvements, and operational tweaks can juice returns even when organic rent growth slows. You’re not just waiting for the market to improve – you’re making improvements yourself.
Consider our new Gainesville, GA, Alessia Gardens property. We’ve got real cash flowing in already, renovation plans that have proven themselves, and that sweet low-rate assumable debt that’s hard to find these days. It’s exactly the kind of recession-proof investment that thrives when others fail, especially with how high-occupancy and recession-resistant the Gainesville market is.
Tariffs, Cost Pressures & Opportunities in Multifamily
With all that said, let’s now address the elephant in the room – or, should we say, the new tariffs in the supply chain. The current trade tensions and potential tariff increases could impact multifamily investments in ways that might surprise you- good and bad.
Potential Benefits
Believe it or not, trade tensions and tariffs could actually create some advantages for multifamily investors. When tariffs push up the cost of living, more people postpone homeownership and stay in rental markets longer. That means higher occupancy rates and stable demand for apartments, especially in Class B/C workforce housing where most regular folks live.
Tariffs also tend to spark a “buy American” movement, which often brings jobs back to domestic manufacturing. This reshoring trend creates job growth in secondary markets tied to logistics, energy, and defense sectors. Cities like Fayetteville, NC, could see increased housing demand as these industries expand.
And here’s the kicker – multifamily investments typically serve as an inflation hedge. When tariffs drive inflation through higher costs, rents can adjust annually while real estate assets maintain their value.
Potential Headwinds
Not everything’s sunshine and low cap rates, though. Tariffs on imported building materials (steel, aluminum, lumber, flooring, appliances) will drive up construction and renovation costs. And when such costs get more expensive, renovation budgets feel it. Value-add projects suddenly need bigger checks to stay profitable, and some development plans get pushed to the back burner.
While rising development costs might actually benefit existing owners by limiting new supply, the immediate impact on CAPEX budgets won’t feel great.
Then there’s the operational side of things. Imported HVAC systems, appliances, and maintenance tools become pricier under tariff regimes and eat into net operating income. There’s no other choice in this environment but to find domestic alternatives and stretch maintenance dollars further.
The bigger economic picture looks dicey, too. Trade tensions that linger too long risk triggering an economic slowdown or full recession. That translates to weaker wage growth for tenants, potentially higher delinquencies, or the need for more concessions – especially in overbuilt or luxury apartment segments where tenant flexibility matters most.
Final Thoughts
Multifamily real estate withstands turbulence—and almost always comes out stronger. But owning property alone won’t cut it.
Our edge? We own the right properties.
We target Class B/C workforce housing in markets where jobs outlast economic temper tantrums. Sure, these properties lack the flash of luxury towers. Yet they deliver consistently as recession-resistant goldmines when other investments tank.
The math is brutally simple: people always need somewhere to live, regardless of what the stock market does.
We’ve learned the hard way that rigidity kills returns. That’s why our renovation budgets flex when construction costs don’t cooperate (and they never do). We secure favorable financing early before interest rates start their wild swings.
Our investment thesis boils down to this: we buy assets that weather storms. In the neighborhoods we target, apartment demand stays strong, and rent checks keep coming—bull market or bear market, boom or bust.
Most importantly, none of this happens without you. Your trust fuels everything we invest in, and we can’t thank you enough.
Happy Investing,
Reed, Ben & The RSN Team
Reed Goossens is an Australian-born real estate entrepreneur, investor, author, public speaker, and an all-around good bloke. Reed got his start in real estate investing back in 2012 when he moved to the US.
