Dear friends,
In 1965 US singer-songwriter Bob Dylan released his song “Like a Rolling Stone”, while returning from a tour of the UK. It was quite an unlikely moment, at the peak of the “British Invasion” of the 60s. The Beatles, The Rolling Stones (confusingly), The Kinks, and The Who were taking the US music scene by storm, so the huge success of the song surprised many. Even more because of its ambiguous lyrics and its somewhat awkward (for radio audiences) length of over six minutes. It has been voted two times as no. 1 in the 500 Greatest Songs of All Time.
Dylan speaks of a stone but did he necessarily have Real Estate in mind? Let’s dig in the lyrics. “How does it feel, To be without a home, with no direction home? Like a complete unknown? Like a rolling stone?” He describes the downfall of a girl from her previously good and luxurious life, obviously to a state of poverty and even homelessness. A girl that went to good schools, hung out with rich people and was used to luxury, but was not streetwise and depended on others despite saying that she will never compromise. A sad state to be truly, but what can we learn from it?
At Artemis Assets we think that the clue is in the lyrics. Dylan speaks of a home. The song’s protagonist, Dylan calls her “Miss Lonely”, would have never met such a fate if she owned some Real Estate. Home ownership, and the passive income that comes from it, is the most important protection from poverty. Because at the end of the day it has a functional use; you can live in it which you cannot do with a stock or crypto.
Further, Real Estate is a solid foundation on which to build any investment portfolio. Miss Lonely didn’t know that Real Estate has historically produced similar returns as the S&P 500 (approx. 10% in the US) but with less volatility. Miss Lonely didn’t know that Real Estate benefits from inflation via its cash flows, which we all know because we have never seen rents go down. On the contrary, it is obvious that US family offices have been listening to Bob Dylan’s message, as the share of Real Estate in their holdings went up from 13% in 2016 to 22% in 2022.
If you read and understand this, please don’t be like Miss Lonely. Reach out to Artemis Assets to discuss your Real Estate investment plans before it’s too late.
Until the next one!
