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one of the key factors to property values (especially multi-family) is population growth. Even in a market downturn people still need a place to live, and people still have kids graduate and move out of their parents houses. The only other option is homelessness, which in my market (Maine) isn't viable. Price downturns should only happen in places with severe oversupply of new builds where the market can't sustain it: even then, the population will eventually grow to fit the additional supply.
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I have no idea what is next for home values. I am no economist, but I cannot find anyone below the age of 45-65 range that can even complete simple tasks reliably without major drama and attempts to cheat me. Judging by that alone, I think we are looking at some sort of population uselessness bubble. I mean how can this be good? I hear it constantly from my friends as well. It's very difficult to find help that will be worth even minimal wages!!!
You are not alone, there are a lot of spooky things out there. a lot of this value run up is probably due to pure inflation and Fed Reserve Quanative Easing (pumping more cash into circulation)
I don't know, but something don't feel right.
I have 3 offers out right now and will continue forward with caution. I will say this is the longest period I have gone in a buy cycle without closing. I have pretty high equity cushions in each property, so I can absorb a pretty good value drop, but even if my properties did go underwater, One hidden benefit of using this BRRRRR strategy is that each property is top notch and desirable. So I think I will still attract tenants. Can lower rents quit a bit even to keep them full.
Pantry is stocked. Cows have hay, chickens are fed. Lets do this drop thing!!!!
Homes in the Hood
You are always looking for deals to buy. The velocity of deals being done can make a difference in market cycles at various points in time.
Buying assets with top market rents and high debt could be a bad thing as it saddles you with non-producing with loss or neutral debt load which can hurt ability by more properties.
I saw in the last downturn of 2007,2008 where people had a buy anything mentality and the train stopped. Their good properties were feeding the dogs for propping up cash flow. Someone can always usually point to some reason for not buying a property. They are serial lookers for years and never do anything. There is not a no risk property just different levels of risk.
As a wise man said It's not timing the market, it's time in the market
Stay on the side line you get none of the tax benefits which could assist you today rather than tomorrow
Updated 7 months ago
The points in this doc were relayed to my by Garrett White from a conference he attended.
Buy smart and don't over leverage yourself. If we wait for a crash some of us might be waiting for sometime and miss out on opportunities we have around. I'm in this for the long run, if the market does crash I will continue to buy and dollar cost avg my investments. Best of Luck.
The market is slowing down.
(At least with owner renovations and buying. )
With the bump in interest rates, people will slow down borrowing until spring and summer. That extra 100$ a month on a loan will deter many from a deal. Confidence is down and distractions are high this time of year.
The distraught will sell reasonably, but they are not easy to find . I’m going to buy if the math works and the area is growing.
It’s a bit early , but north Florida may have some deals coming up.
It started about 6 months ago. To catch the trough of the market is impossible. Because you need two or several solid data points to substantiate the lowest point is behind you. That means it was 9 months ago when it was the lowest price point. The government tries to correct the market with incentive programs. That was why during the Great Recession after the incentive expired it went south again. 80% people do not know median home price is not the proper home price indicator.
You can wait at the cost of higher interest rate. Expect 1% higher in 2019.
Originally posted by @Matt Millard :
Because the FED reinflated housing falsely through money printing & low interest rates!
Interesting argument ...one that has been being made for the last 200 years actually. Printing money however causes inflation. Inflation raises the prices of real estate.
@Jonathan Hulen to buy at discount is hard now. This is what I do in Cleveland. I wouldn't focus on appreciation. Because that can drop in a heart beat. Concentrate on cash flow. I thrived during the housing collapse. I was collecting rents on paid off properties while others were loosing their properties. Go by cash flow. Appreciation last
REI 101 tells you that isn't a get rich quick game (but some may be successful with some home runs)
As long you have a long term vision there’s no “crash” that can affect you. Even if you make a mistake and buy high you won’t loose money as long you don’t sell it. As I like to say .... you may not make money buying at the wrong time but you will loose money sell it at the wrong time”
Focus on monthly cash flow and let it sit .... simmering slow it will boil up after a couple of years
You don’t wait to buy real estate, you buy real estate and wait.
N one truely knows when the market is going to head towards the downward direction. If so, one would have to predict the future with 100 percent accuracy. Only you can make the decision to invest or to wait.
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