Multifamily Giants Outperforming 2021 Expectations Sitting Pretty Heading Into 2022

 

THIS YEAR HAS GONE BETTER FOR MULTIFAMILY REAL ESTATE THAN VIRTUALLY ANYONE PREDICTED WHEN THE CORONAVIRUS PANDEMIC BEGAN, INCLUDING THE HEADS OF THE SECTOR’S BIGGEST COMPANIES.

Six of the largest multifamily REITs to have released their earnings reports for the third quarter all reported outperforming their year-to-date performance guidance, including Mid-America Apartment Communities, AvalonBay Communities, Equity Residential, Essex Property Trust, UDR and Camden Property Trust. With rents increasing at a dramatic pace and capital availability at historic levels, the biggest landlords in the country are riding high.

Across all of the earnings reports and the calls between the companies’ executives and financial analysts accompanying the reports, common themes emerged within the overall sunny outlook: average occupancy over 96%, cap rates below 4% and an impetus to build new apartment buildings at a greater rate than was expected at the start of the year.

“We continue to aggressively sell our older and less desirable properties at these low cap rates and at prices that exceed our pre-pandemic value estimates, [as well as] acquiring much newer assets in our expansion markets,” Equity Residential President and CEO Mark Parrell said on his company’s earnings call. “We have funded these buys with an approximately equal amount of dispositions of older and less desirable assets.”

The resounding success of the largest landlords stands in stark contrast to the ongoing troubles owners of small numbers of rental units are facing, including being saddled with a disproportionate number of tenants who owe back rent.

The major players still have considerable numbers of tenants who had struggled with rent payments through the pandemic, but they have used their resources to either apply for the federal government’s Emergency Rental Assistance program on their behalf or helped them to apply directly. AvalonBay, Camden, Essex, Equity Residential and UDR all reported receiving more than $10M in ERA payments for their tenants so far this year and all expect to receive further payments before the year is out.

In a similar vein, the widening gap between the demand for single-family homes and the pipeline of new construction counts as good news for the multifamily industry as cost increases and delays in construction serve to drive the price of housing up.

“Price appreciation in the for-sale single-family market and relatively stable multifamily supply both support a healthy near-term outlook for rental rate growth,” AvalonBay Chief Operating Officer Sean Breslin said on his company’s call.

As the lion’s share of units owned by major multifamily REITs are Class-A, executives reported their tenant base as emerging from the pandemic in strong financial positions and with historically high levels of savings, encouraging landlords they can absorb steep rent increases. Loss to lease, the difference between rents paid by in-place tenants and tenants signing new leases today, averaged more than 13% between the largest REITs to have released earnings reports for the third quarter.

Clockwise from top left: Walker & Dunlop CEO Willy Walker, Equity Residential CEO Mark Parrell and Boston Properties CEO Owen Thomas on the Walker Webcast.

“This is definitely the highest loss to lease we have ever seen, with such a large majority of leases below market,” Equity Residential Executive Vice President and Chief Operating Officer Michael Manelis said on his company’s earnings call. “And [our] teams are hyperfocused to recapture as much of the loss to lease as possible.”

Camden Property Trust reported its loss to lease as high as 16% in the third quarter, but Executive Vice Chair Keith Oden told analysts that his company will focus on maximizing retention by avoiding raising rents all the way to market rates for renewing tenants. Even without such consideration, all of the six multifamily REITs mentioned reported higher renewal rates this year, with the relative lack of turnover giving landlords more pricing power.

Pricing power is an incredible tool for landlords with enough scale, as MAA, the largest landlord in the country by unit count, is demonstrating. Despite the supply chain and labor market causing shortages and delays across commercial real estate, MAA’s pipeline of developments under construction is currently on time and on budget, CEO Eric Bolton said to analysts.

Even with the various tailwinds the multifamily market is currently enjoying, with values and deal volume hitting record highs, at least some major landlords have used innovations born out of pandemic necessity to cut costs permanently. Executives from Equity Residential and UDR told analysts prospective tenants seem to prefer self-guided tours and digital platforms for services when possible, boasting higher customer satisfaction numbers even as they have cut staff at their properties.

“Since the second quarter of 2018, we have permanently reduced headcount at our communities by 40% on average, thereby providing a strong hedge against elevated inflationary pressures,” UDR Senior Vice President of Property Operations Michael Lacy said. “[We] delivered products and services in the formats our residents prefer, as exhibited by a 24% increase in our resident satisfaction score and an overall 97% usage rate for self-guided prospective resident tours.”

Though thinner on-site teams may be a permanent consequence of the pandemic, major investors are well aware the current environment for raising capital is not likely to remain this friendly for long thanks to continued inflation and predicted changes to monetary policy from the Federal Reserve.

MAA issued $600M in public bonds in Q3, extended the average maturity on its debt to nine years away and raised $210M of forward equity capital, which MAA Chief Financial Officer Albert Campbell told analysts would cover the company’s equity requirements for the next couple of years. UDR agreed to $350M worth of forward agreements for stock purchases in the quarter, added $200M each to its credit facility and commercial paper capacities and extended maturity dates on other loans.

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Source: Multifamily Giants Outperforming 2021 Expectations Sitting Pretty Heading Into 2022

https://www.creconsult.net/market-trends/multifamily-giants-outperforming-2021-expectations-sitting-pretty-heading-into-2022/

ULI Says US CRE Should Return To Pre-COVID Levels by 2023

 

“The real estate sector is in a strong position to build its way out of the pandemic and take the economy with it.”

The US real estate market is predicted to return to pre-pandemic levels by 2023, with equity REIT investors poised to win big.

Total annual returns for equity REITs are predicted to reach 27.8% in 2021, according to ULI, topping 2019’s previous high of 26%.

“The forecast comes close to the 2014 peak of 30.1% and almost doubles the spring 2021 forecast of 15.0%. At 10% annually, the forecasts for 2022 and 2023 fall back to closer to the 20-year average of 11.3%,” ULI economists note in a recent release outlining their economic predictions for the next few years.

Meanwhile, the Fall 2021 ULI Real Estate Economic Forecast for 2021 to 2023 says the hotel sector will face ‘significant disappointments.’ RevPAR fell 47.4% in 2020 and should peak at 12.2% in 2022. The forecast for 2021 has ‘collapsed’ from 29.6% made in the Spring to 5% now.

“The US economy remains relatively attractive for real estate, especially in contrast with the period immediately following the global economic downturn in 2008/9,” said Ed Walter, ULI’s Global CEO. “While prolonged high inflation could damage the viability of pipeline projects, the short-term spike predicted should have less impact. This is why we see transaction volumes recovering so quickly and investment returns for core property types looking so healthy. The real estate sector is in a strong position to build its way out of the pandemic and take the economy with it.”

ULI predicts GDP growth for 2021 will hit 5.7%, a decline from spring 2021 numbers but “still more than double the bounce back seen in 2010,” ULI analysts say. Longer-term forecasts are more stable and remain above the 20-year average of 2.5%.

Inflation may hit 4.3% in the fall but ULI says its analysts are “optimistic about this spike receding rapidly to near 2019 levels in 2023.” Interest rates are expected to rise gradually to 1.6% in 2021 and 2.25% in 2023, lower than the 20-year average of 3.07%.

Cap rates are expected to fall to 4.3% for 2021 and 2022 before moving upward again in 2023. And “for capital markets, the forecast shows growing optimism about commercial real estate transaction volumes in the next three years with forecasts falling just short of 2019’s peak of $617 billion,” ULI notes, adding that issuance of Commercial Mortgage-Backed Securities (CMBS) is expected to rise to approach the 2019 peak of $98 billion.

Vacancy is expected to remain high in 2021 rising 200 basis points with only minimal improvement in 2023. Office vacancy rates are expected to reach a ten-year high of 16.9% annually in 2021 and 2022.

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Source: ULI Says US CRE Should Return To Pre-COVID Levels by 2023

https://www.creconsult.net/market-trends/uli-says-us-cre-should-return-to-pre-covid-levels-by-2023/

Increasing Costs and Delays Hamper Multifamily Development

 

As evidence that builders are facing the combined headwinds of rising material and labor costs as well as supply chain delays, the pace of multifamily development is down.

Multifamily starts slipped 5.1% to 467,000 units in September from August’s revised annual rate, while building permits fell 21% to 498,000 units, according to the U.S. Census Bureau. However, for the year, multifamily starts are up 38.2% and permits are up 18%.

As further evidence that multifamily builders are facing headwinds, the seasonally adjusted annual rate (SAAR) for multifamily completions plunged 18.1% from last month and 41.8% from last year to just 280,000 units, while at the same time the rate of units under construction edged up 1.4% to 701,000 multifamily units, its highest total since 1974.

Single-family homebuilders are facing the same industry headwinds for development with the addition of low inventory of developed lots. Single-family starts were unchanged from last month at 1.08 million units but are down 2.3% from September 2020. Building permits for single-family homes were also virtually unchanged (-0.9%) from August at 1.04 million units and were also down for the year (-7.1%). The number of single-family homes currently under construction is also elevated at 712,000 units, the most since the waning period of the housing bubble bust in 2007.

Together, total residential permits were down 7.7% from August to 1.589 million units and total residential starts were down 1.6% to 1.555 million units. Compared to one year ago, total residential permits were unchanged while total starts were up 7.4% due to the sharp increase in multifamily starts from September 2020.

The annual rate for multifamily permitting was up in three of the nation’s four Census regions, with the largest annual increase in the West (up 36.7% to 142,000 units). The Midwest’s annualized rate increased 29.8% to 79,000 units from last September while the South was up 24.6% to 223,000 units. The small Northeast region decreased 30.2% to 56,000 units. Compared to the previous month, all regions decreased, with the Northeast down 28.6% and the South and West down about 23% each. The Midwest region had a more modest decline in annual permitting from last month of 2.8%.

Regional annual multifamily starts were up significantly in the South (+72.2% to 201,000 units) and West (+64.4% to 136,000 units), while the Northeast region fell 8.4% from last year to 52,000 units started and the Midwest slipped 4.6% to 78,000 units. Compared to August’s pace, the South (-5.2%) and Northeast (-45.8%) regions declined while the Midwest (+6.8%) and West (+22.5%) had increases in multifamily starts.

At the metro level, nine of the top 10 permitting markets in September returned to the list from August with only the first two in order and several others changing places. New York continues to lead the nation in multifamily permitting with about 32,200 units but the market’s pace is continuing to slow. Austin again ranked #2 with 23,313 units permitted, an almost one-quarter gain from last year.

Dallas replaced Houston at #3 this month with 16,914 units permitted, an increase of more than 27% from 2020’s slower pace. Houston continues to slow its multifamily permitting despite ranking at #4 this month. More than 15,300 units were permitted in the year-ending September but that was a decline of nearly one-third from last year.

Seattle returned at #5 with about 14,600 units, up about 13% from the previous year, while Phoenix jumped up two spots to #6 with 14,238 units permitted, only an 8% gain over September 2020. Los Angeles ranked #7 this month with about 14,200 units permitted in the year-ending September, up about 10% annually.

Washington, DC and Denver each inched up a spot to #8 and #9 with 14,123 and 13,612 units permitted, respectively. DC grew by 36% annually, while permits in the Mile-High City were up more than 63% from last year. Last month’s #7 – Philadelphia – dropped out of the top 10 this month, replaced by Minneapolis-St. Paul at #10 with annual multifamily permitting of 13,507 units.

Eight of the top 10 multifamily permitting markets boosted annual totals from the year before and they were generally large increases, ranging from a low of 1,107 units in Phoenix to more than 5,200 additional units in Denver. Austin’s increase of almost 4,600 units was second only to Denver and was about 1,000 units more than in Dallas and Washington, DC’s increases over last year (around 3,600 to 3,700 additional units each). The remaining top 10 with increasing permitting averaged about 1,500 additional units permitted over last year’s totals.

Other markets outside of the top 10 that saw significant year-over-year increases in annual multifamily permitting in the year-ending September were Philadelphia (+7,954 units), Jacksonville, FL (+4,028 units), Charlotte (+3,493 units), Raleigh/Durham (+3,438 units), and San Antonio (+2,240 units).

Only two of the top markets saw decreases in the year-ending September 2021. Houston permitted almost 6,500 fewer units than last year and New York’s annual permitting fell by 5,363 units. Significant slowing in annual multifamily permitting also occurred in the non-top 10 markets of Cape Coral-Fort Meyers, FL (-2,972 units), San Jose (-2,714 units), Kansas City (-1,744 units), and Bridgeport, CT (-1,180 units).

Six of the top 10 markets had more annual multifamily permits than the previous month, with Dallas jumping almost 7% from August’s annual total. Phoenix, Washington, DC, Minneapolis-St. Paul and Denver were up an average of about 5% from last month, while Los Angeles improved only about 1%. Houston fell 11.6% from last month with Austin and New York retreating close to 7% from the previous month’s annual totals. Seattle slipped only 1.4%.

The annual total of multifamily permits issued in the top 10 metros – 172,036 – was about 7% more than the 160,754 issued in the previous 12 months. The total number of permits issued in the top 10 metros was almost equal to the number of permits issued for the #11 through #35 ranked metros.

All of last month’s top 10 permit-issuing places returned to this month’s list with five remaining in the same order. The list of top individual permitting places (cities, towns, boroughs, and unincorporated counties) generally includes the principal city of some of the most active metro areas.

The city of Austin returned as the #1 permit-issuing place with 12,235 units. However, that annual total was 1,329 units less than last month’s. The city-county of Nashville-Davidson and the city of Los Angeles returned in order, permitting 11,526 units and 10,850 units, respectively.

The city of Seattle replaced the city of Houston at #4 on the list with about 8,100 units permitted, a decrease of 1,039 units from August, while the cities of Denver and Houston came in at #5 and #6, permitting about 7,800 units for the year each. The borough of Brooklyn permitted almost 7,200 units for the year-ending September, ranking at #7.

Mecklenburg County (Charlotte) moved up to #8 from #10 last month with 6,378 units permitted, close to last month’s total. The city of Phoenix remained at #9 in September with almost 6,300 units permitted, while the Bronx borough slipped two spots to #10 with about 5,800 multifamily units permitted for the year.

Texas still dominates the list of permitting places with seven of the top 20 permit-issuing places, while no other state has more than two spots on the list. While the list of top markets for metro-level multifamily permitting generally saw increases over last month, only three place-level cities or counties had increased permitting from August’s annual totals.

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Source: Increasing Costs and Delays Hamper Multifamily Development

https://www.creconsult.net/market-trends/increasing-costs-and-delays-hamper-multifamily-development/

Multifamily Market Conditions Showcase Strong Improvement

 

Three key indicators continue their steady rise, according to the organization's latest survey.

The National Multifamily Housing Council’s Quarterly Survey of Apartment Market Conditions for October 2021 show strong and ongoing improvement continues across the multifamily industry. For the third quarter in a row, the Market Tightness (82), Sales Volume (79) and Equity Financing (65) indexes reflected results considerably above the breakeven level of 50. And while the Debt Financing (48) index showed weaker conditions, most respondents felt conditions were unchanged from last quarter.

“Ultimately, this is good news for the multifamily industry,” Caitlin Sugrue Walter, vice president for research at Washington, D.C.-based National Multifamily Housing Council (NMHC), told Multi-Housing News. “This data highlights the ongoing strength of the sector based on the strong demand and fundamentals underlying the market.”

Sales Volume vs. Market Tightness. Data and chart courtesy of NMHC

Tighter conditions

The Market Tightness Index fell from 96 to 82, indicating tighter market conditions. Almost three-quarters (71 percent) of respondents reported market conditions were tighter than three months earlier. Only 8 percent reported looser conditions, and 20 percent felt conditions were unchanged from the second quarter.

The Sales Volume Index registered a 79, a number unchanged from a quarter earlier. That indicated ongoing robustness in apartment sales volume. More than half (61 percent) of respondents said sales volume was higher than it had been three months earlier, while 32 percent believed volume had remained unchanged. Only 4 percent felt sales volume was lower than the prior quarter.

The Equity Financing Index inched lower, from 69 to 65. Just about one-third (33 percent) of respondents saw greater availability of equity financing than they had in the quarter prior. Meanwhile, more than half (52 percent) felt equity financing conditions had remained unchanged. Only 4 percent found equity financing less available.

Representing the only index to dip below break-even level for this quarter, the Debt Financing Index dropped from 71 to 48.

Some 17 percent of respondents indicated conditions for debt financing were better in the third quarter than in the prior three months. But 21 percent believed financing conditions had worsened. The majority reported conditions in the debt market were unchanged.

The strong demand and fundamentals underlying the market are good harbingers for the future, according to Walter.

“Looking ahead, this demand is likely to continue, making for a positive short- to mid-term horizon for the industry,” she said.

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Source: Multifamily Market Conditions Showcase Strong Improvement

https://www.creconsult.net/market-trends/multifamily-market-conditions-showcase-strong-improvement/

More Tenants Working From Home Means New Expectations Of Landlords And Amenities

 

CLA's Carey Heyman, Universe Holdings' Henry Manoucheri, AXIS/GFA's Cory Creath, Roundtree Properties' Tammy Harpster and Greystar's Kesha Fisher

With more and more tenants working from home, multifamily landlords are making adjustments to interior design, property management and amenities to keep up.

Nearly 19 months after the onset of pandemic lockdowns, adjustments that might once have been predicted to be temporary — working from home, dealing with high package volumes — are still very much influencing the multifamily market and how owners approach attracting and retaining tenants, real estate industry professionals speaking at Bisnow’s Multifamily Annual Conference West event said Tuesday.

“I don't think that work-from-home is going anywhere,” Greystar Senior Director of Real Estate Operations Kesha Fisher said. “And so you're going to have to ensure that you have different types of amenities.”

Developers are designing spaces with the anticipation that tenants will be working from home through modern changes to common and private spaces. The shared business center of old has been replaced by a WeWork-type space with individual pods for working in, Fisher said. In-unit changes range from creating nooks that can function as workspaces or adding USB chargers to all the outlets, she said.

Resident services are also increasingly important, Fisher said. Greystar has started using third-party providers to accommodate higher package volumes that have increased exponentially in the wake of the coronavirus. Greystar has also noticed an 80% increase in pets across its portfolio, which has led landlords to introduce pet amenities — dog runs or so-called yappy hours — as a tenant retention tool.

“If I love my neighbor and our dogs are friends, I'm going to stay there longer,” Fisher said.

Residents working remotely and spending more time in their apartments has translated into some higher expenses for property owners. Roundtree Properties CEO Tammy Harpster said utility bills are higher, prompting the firm to look at solar panels as a possible mitigator to reduce some of the higher overhead costs.

Another owner side effect: Tenants are far more attentive to the time frame it takes for owners to respond to their requests for repairs. Because more people are spending more time in their homes, there is a greater urgency to respond to noncritical maintenance requests, Harpster said.

“It might not be an emergency, but when they see it all the time, it's an emergency for them,” Harpster said.

The rent debt that many tenants now carry in the wake of the coronavirus pandemic is still very much weighing on the minds and bottom lines of industry leaders.

Fisher, Harpster and Universe Holdings CEO Henry Manoucheri all said that money from more than $1B of state funds for rent relief has begun to flow in. Fisher said Greystar has received about $300K in rental relief for back rent at California properties. Manoucheri said he’d received about $600K so far, though he voiced a concern that many of his tenants who are receiving assistance don’t actually need it.

“You have to make sure that you're looking at the rental assistance portal, you have to make sure that you're talking to caseworkers, and we do see that that recovery in California is happening,” Fisher said. “It's happening slowly, but it is happening.”

AXIS/GFA Architecture + Design Founding Principal Architect Cory Creath also spoke on the panel, which was moderated by CLA Principal of Real Estate Carey Heyman.

 

Source: More Tenants Working From Home Means New Expectations Of Landlords And Amenities

https://www.creconsult.net/market-trends/more-tenants-working-from-home-means-new-expectations-of-landlords-and-amenities/

Is a Bubble Forming in Commercial Real Estate?

 

• The big question on many investors’ minds – “Is a bubble forming in CRE?”
• From a macro level, Retail, Urban Office and Suburban Office are clearly not in a bubble
  • -  Price growth has been moderate, and fundamentals have kept pace with price gains
• While Apartment values have climbed considerably, historically strong vacancy and rent growth support strong appreciation – Structural housing shortage also a strong tailwind
• Similarly, Self-Storage price gains are backed up by record property performance
  • -  Vacancy at all-time low and rent growth is strong
  • -  COVID helped quell overdevelopment risk, keeping supply and demand in balance over the short-term
• Even Industrial, where exuberance has been strongest, is likely not in bubble territory
  • -  Vacancy, rent growth and NOIs support the aggressive price appreciation
  • -  eCommerce and supply chain disruptions provide long-term tailwinds to the industry
• Investors should closely monitor the supply and demand outlook for the next 3 to 5 years

 

https://www.creconsult.net/market-trends/is-a-bubble-forming-in-commercial-real-estate/

Congress wants to kill the 'backdoor Roth IRA.' Here's what it means for you

 

 

Tax-free savings in retirement are great to have at your disposal. But provisions in the Build Back Better bill would limit some of the ways to accrue them in the future -- at least for high-income savers. The provisions are included in the version of the bill that recently passed the House, and is set to go to the Senate for consideration in December.

No more 'backdoor' conversions to Roth IRAs

A key way to build tax-free savings is to contribute to a Roth IRA.

While you won't get a tax break for your contributions to a Roth IRA, the after-tax money you put in will then grow tax-free and can be withdrawn tax-free once you reach retirement age. In 2022 you can contribute up to $6,000 a year ($7,000 if you're 50 or older).

High earners, however, are prohibited from contributing directly to a Roth IRA if their modified adjusted gross income in 2022 is at least $144,000 ($214,000 if married).

But they can still create a Roth IRA through a so-called "backdoor" strategy that involves converting their other IRA savings.

Although high-income taxpayers are precluded from making deductible contributions to a traditional IRA, they are allowed to make non-deductible ones.

In transferring a non-deductible IRA to a Roth, you would owe tax on the gains that had accrued on your contributions. That's avoidable, however, if you make the conversion immediately after making your non-deductible IRA contribution, since there would be no time for the money to grow.

But this strategy may get the ax. Starting next year, the House-passed bill would prohibit all taxpayers from converting their after-tax contributions using this "backdoor" conversion method to a Roth IRA.

No more 'mega backdoor' conversions to a Roth 401(k) either

The bill would also prohibit a similar strategy that is currently permitted when it comes to Roth 401(k)s.

Roth 401(k)s are another great way to build tax-free retirement savings and they are now offered by a majority of employers that offer tax-deferred 401(k) plans. Unlike Roth IRAs, Roth 401(k)s do not have any income eligibility rules and they allow for much higher contributions -- up to the 401(k) limit of $20,500 starting next year ($27,000 if you're at least 50).

On top of that, your employer also may let you make after-tax contributions to your regular 401(k), the gains on which would be taxable when you withdraw them. Under current law, you may convert those pre-tax and after-tax savings from your 401(k) account into a Roth and thereby skip having to pay taxes on future withdrawals.

In total, savers effectively can sock away up to $61,000 next year ($67,500 if you're at least 50) -- once your contributions, your employer match and your after-tax contributions are counted.

So for high-income earners, it is possible to convert large sums of money into a Roth 401(k) through what's known as a 'mega backdoor' strategy. Under the bill, however, starting next year, taxpayers would be prohibited from converting the after-tax portion of their 401(k) savings into a Roth.

Then, a decade from now -- in 2032 -- anyone with modified AGI over $400,000 (or $450,000 if married and filing jointly) would also be prohibited from converting their pretax savings into a Roth. That would apply whether their pre-tax savings come from their 401(k) or a traditional, deductible IRA.

What won't change

There is no predicting whether lawmakers will preserve the Roth restrictions in the House-passed Build Back Better bill -- or even if the bill itself will become law. But if the prohibitions on backdoor Roth conversions do survive, Roth IRAs, Roth 401(k)s and Roth conversions will still be useful vehicles for the many savers who meet the income and other eligibility rules governing Roths.

And nothing likely will change for anyone when it comes to their 2021 savings strategies. "We're executing 2021 contributions [and] conversions by December 31 as our best thinking is the bill will have no effect on 2021. For 2022 and beyond, we're taking a wait-and-see approach," said New Jersey-based CPA and certified financial planner Joseph Doerrer.

But for his high-income clients, Doerrer said he is strategizing when and what portion of their savings it makes sense to convert to a Roth before the window potentially closes for them in 2032.

"We're modeling out smaller piecemeal conversions, if we have any favorable play in their tax brackets, to chip away at their pre-tax balances in the event there is the 10-year or so proposed window after which Roth conversions would be unavailable to higher income individuals."

For Florida-based certified financial planner Mari Adam, her advice to clients remains the same regardless of the fate of the Roth provisions in the bill.

"Save consistently, spend moderately and invest for the long-term," she said. "The only advice I would add? Stay nimble. Tax rules change, so stay flexible and avoid committing to any financial strategy that can't easily be undone when the tax regime changes."

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Source: Congress wants to kill the ‘backdoor Roth IRA.’ Here’s what it means for you

https://www.creconsult.net/market-trends/congress-wants-to-kill-the-backdoor-roth-ira-heres-what-it-means-for-you/