During the pandemic a lot of investors sold off their REIT shares. Although this might be a smart move for some REITs, I think that it was a bad move for shareholders of AvalonBay Communities (AVB). At the moment I think that AVB trades at a discount of 4.8%. I think that the work-from-home and moving-to-rural-areas narratives have been overdone. In this article, I will explain why I think this - and what this means for AVB's share price.
Why most of us will stay in the cities
According to polls that were held at the beginning of the pandemic around 1/3 of the US population was considering moving away from the cities to rural areas. Moving to rural areas is great if you work from home, but once the pandemic is over I expect that most people will at least go back to the office during a few days of the week. I explained this more in-depth in my previous article on Seeking Alpha that can be found here. When we have to go to the office at least 2 days a week it does not make sense to move over 2 hours away. Especially if you take into account the traffic jams when you drive into the city.
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