Inflation, is it a bad thing? Well, I'm not an economist. So, I can tell you how Inflation affects every sector of our economy. But I can tell you from a commercial real estate perspective, and particularly the apartment sector, it can actually be a good thing. And here's what we know that inflation, the cost of everything goes up from a gallon of milk to rent, rent being the operative word here. So, when rent goes up, that means the income coming into apartment complexes goes up, that means the value of the apartment complex as a whole goes up, right? Yes, expenses go up to during inflation, that happens because everything goes up. But your expense to income ratio is always going to favor that income side. And expenses always lag behind that income. So, it's not proportional. And so overall, the value of the entire buildings can go up, because the commercial real estate sector is all valued based on the income. So basically, what inflation is doing is it's driving up the value of these assets.

And everybody hears that during times of inflation, you want to be in hard assets, if you're sitting on cash, that cash is literally losing money. That's what inflation does. And if you have in a savings account, or something that's not countering it much, because no savings accounts right now we're getting 1% or less, maybe they've gone up a little bit. I don't know, I don't have anything in savings accounts right now. But I do know that inflation is between seven 9%, depending on where you are in the world right now.

So, you are losing money right there. So, you are being solid acids, whatever those might be. But apartment complexes are one good place to put your money right now. Another concern I hear people talk about is what about the fact that the Federal Reserve is raising interest rates, doesn't this affect the income and the cash flow of apartment complexes, if you are in an apartment complex right now, I'd say you don't have much to worry about, because you probably have a fixed rate loan, most places will have a fixed rate loan, so you've probably locked it in and nothing's going to change for you.

If you're buying something new, or you're getting into syndication, or somebody's buying something new, it's all about how they structured the finances. Okay, and we're seeing a lot of creativity right now. And we're seeing sellers become a lot more flexible, because they understand that the interest rates are not as low as they were, we got little spoiled there for a while, I mean, historically low interest rates, right. So now when the seller is offering an apartment complex for sale, you can go to him and say, hey, you know, it's going to cost me more every month to maintain this place. So, I'm going to need to pay a little bit less. And we're seeing some sellers negotiate a little bit on that price.

More are willing to negotiate on terms, so maybe they're willing to sell or finance it to you at a lower rate than what the banks are offering. Or, and we see this a lot too, they were lucky enough to lock in one of those historically low interest rates, and they have an assumable loan. So, when you buy it, you can come in assume that loan, okay, now you just have to pay come up with the difference between the bounce of that loan and the current sale price, maybe you have that in cash, maybe you get a little bit from the seller, maybe there's a little seller financing in there. There are lots of ways to structure that. So, it's really all about how to structure it. We're also seeing lenders be a little more flexible on interest, only some of our offering long interest only periods like three to five years. So yes, you're paying higher interest, but you're not having to pay principal at the same time.

So, you're still cash flowing really well. And we say marry the property date the debt service. Okay. So, if the debt service gets a little better, if it looks a little prettier over here, we can maybe shimmy over there. So, during that interest only period of that three to five years if interest rates drop, refinance, okay, and then lock in a rate when you've got to lower rate. So, we're seeing a lot of this, it's all about structuring it. So, if you buy right, and that's kind of always the key anyway, but buying REITs structuring it right financing, right.

Commercial real estate is still a fantastic place to be in right now when you can take advantage of that inflation, propping it up. So, in every market, every market out there has opportunities. Okay. It's just a matter of where you are. Right now. I wouldn't say the market isn't the opportunities in the stock market. I can't even look at my quarterly statements like I just shove them in a drawer, because it's so volatile right now. Okay.

But there are people taking advantage of the strong US dollar right now. They're doing some currency trading and things like that. There are opportunities in every market. And right now, you know, this inflation is probably really bad for renters, and I hate that I tell everybody who rents that I know. Buy something now don't worry about the interest rate lock in that cost is a roof over your head because it's probably not going to get any better. Maybe you're not going to buy that dream house you always wonder the dream condo the green dream apartment, but worried about that later for now lock it in because this is not probably going to get any better. Right? So, it's not great for them. It's not great for many sectors of the economy, but there are opportunities in every market and right now there is an opportunity and buying apartment complexes that you know the value is going to get pushed up by this inflation. So that's it for me on inflation. Thank you so much.