Where is the market now?

Everyone will tell you that real estate markets go in 7 year cycles. Seven years up followed by seven years down. Well folks, we are past the 7 years up, so the gravity on the up side is starting to weigh on these fundamentals.

In the last two years deals have been hard to come by because the market is frothy. I recently found a deal on MLS and this is a canary in the coal mine telling me that things are about to change. Maybe not this month or even this year, but expect and be ready for the change.

What are the changes to get prepared for that will affect your investments?

If you rent homes, be prepared for lower rents and longer vacancies, so adjust your expectations and financial projections. You will need to reduce expenses and increase your cash reserves now in order to make it through any rough spots.

If you sell real estate, you may not be able to count on quick sales and higher prices. So, don't carry huge inventories with tight margins.

If you prepare now and there is a rough spot, then you will prosper. If you prepare now and there is no rough spot, then you prosper. Win/Win.

Now is the time to be flexible and change with the market conditions. Go forth and prosper.