What the 2021 ‘Revenge Summer’ Means for Southeastern Real Estate

By Strategic Passive Investments

What do swimming with whales, glamping in a treehouse in Cabo, and wildly enthusiastic stock purchases fueled by TikTok videos have in common? The answer might surprise you.  It’s not millennials, zoomers, or things on a bucket list. The answer is a far simpler, two-syllable concept: Revenge. And revenge is going to mean big things for the southeastern United States housing markets in 2021 and far beyond. But before we dive into what revenge has to do with housing and your real estate portfolio, let’s explore why the concept is dominating economic discussions around the country.

Americans are Mad at COVID-19 – and They Want Revenge

It might sound silly to talk about fully grown adults being “mad” at a virus. “Surely, they’re mad at the politicians and the lockdowns and the mask mandates (or lack thereof) or the stimulus spending, etc.,” you’re probably thinking. It’s tempting to think that, but all current indicators show that Americans are actually just out to regain lost time, lost experiences, and missed opportunities. It is kind of like a certain segment of the population – not a certain generation but those with a certain amount of disposable income going into 2021 – is out to prove something to COVID-19. They have been missing out, and the malingering threat of another round of lockdowns this fall or winter has everyone coming down with a contagious case of FOMO (fear of missing out) that is spreading like wildfire.

That FOMO is fueling what economists are calling a “revenge summer” of consumer spending, travel, and behavioral changes including:

• Sinking lots of stimulus money into “meme stocks,” cryptocurrency, and special-purpose acquisition companies (SPACs) even when the investor in question has never even bought stock prior to summer 2021. As New York Times contributor Erin Griffith described the situation, “All year, amateur investors, propelled by a social media frenzy and a bit of boredom, have poured money into risky forms of investments.” As the world “reopened,” Griffith continued, market watchers “expected the investment world to return to something resembling normalcy.” However, she concluded, “That hasn’t happened.” Instead, new investors are developing a strong herd mentality and fueling their portfolios with stimulus funds. It’s only a matter of time before they start looking at real estate as the next thing they can’t afford to miss, and that will mean volatility in REITs and other real estate-backed assets that are highly accessible to investors with limited capital.
• Spending lots of money and time on lavish vacations. Americans are hard workers, and the “long weekend” has long been considered the height of vacation appeal because it did not necessitate weeks away from the office. Thanks to COVID-19, however, long weekends and summer vacations took a far-too-long hiatus for most consumers, so they’re fighting back this summer by spending big bucks and lots of vacation time on a “welcome-back-to-travel trip” that could, according to travel agents interviewed by Refinery 29, result in a new “golden age of travel” for the industry. This is great news for outdoor travel destinations, in particular, where people can continue to indulge their new appreciation for the outdoors and spread out a little more than they might in an indoor setting. Travel stimulates the economy, and the southeastern United States has long been one of the most attractive and affordable destinations for travelers. That is playing a huge role in the intense demand for rental properties in areas two hours or less from seaside attractions both for short- and long-term living.
• Increased focus on mental health and wellness. If you’re a fan of Khloe Kardashian’s reality television series Revenge Body, well, I’ll try not to judge you – especially since the concept has a lot to do with America’s Revenge Summer and how it’s going to affect your real estate investments in 2021 and beyond. For those of you not so familiar with the Kardashian-Jenner internet dynasty, Revenge Body is a reality show hosted by Khloe Kardashian that involves getting really in shape and focusing on physical and emotional health in order to get “revenge” on a negative external event in your life. In Kardashian’s case, her revenge body came as the result of hours spent in the gym during a tumultuous divorce. For post-pandemic Americans, Revenge Summer is extending into their emotional well-being behaviors and, for about 25 percent of workers who remained employed during the pandemic, that means quitting their jobs post-pandemic. These workers cite a desire to continue working remotely, a belief they can earn more money in positions more amenable to their desires to live in different locations (like the Sun Belt and the Southeast), and FOMO based around the idea that their mental health is suffering under current working conditions and a better life is waiting to be lived elsewhere.

These behavioral trends are manifesting themselves in a way that is absolutely rewarding Revenge Summer participants at present. Cryptocurrency investors, while experiencing some volatility at present, are still feeling confident, while many meme-stock investors are deriving as much pleasure from bolstering struggling companies like AMC Theaters as they are from watching their bottom lines rise. Revenge travelers are reveling in Instagram treasure as they post shots from their latest experiences and reassure each other that they deserve these experiences, thereby feeding the social-media frenzy and FOMO for those of us still at home. And those folks quitting their jobs? Well, the side-hustle economy is thriving, and U.S. employment for the demographic that can afford to quit and move is also in great shape. And that, readers, brings us to the southeast.

According to online brokerage Redfin, Atlanta was one of the top five moving-destination cities for 2020. United Van Lines (UVL)’s annual migration study showed roughly twice as many people moved to South Carolina, Georgia, and Florida as moved out, and one in five cited “lifestyle” as their reason for making the change. About a quarter of the moving population also said they moved because of a change in employment. With pleasant weather, a temperate climate, and some of the most affordable costs of living in the United States, the southeast continues to attract new residents for traditional reasons and, thanks to the post-pandemic Revenge Mindset, a whole host of new ones.