How will your market do in 2019?

Question

Interesting article I came across for West Michigan. What is everyone's prediction for the markets the invest in?

https://www.rejournals.com/colliers-forecast-chances-for-recession-in-west-michigan-are-slim-20190204

Ray Johnson · Answer

@Frank Boenzi While I have no crystal ball, I'm in major metropolitan markets that have had very aggressive run up over the last 8 years, I have individual properties that have gone up a minimum of $200K and more in the California properties, and nearly the same in the Washington, DC market, I'm anticipating some corrections in these markets at some point. I bought right so I'm not focused or thinking about the corrections, In fact I'm really hoping for market corrections so I can acquire more properties.

A friend asked me why does someone who invest in Real Estate want the market to tank so bad, I explained that I can grow and scale faster in a down market, especially in the major metropolitan markets where the up-and-down swings in prices are much bigger allotting for better long term growth.

John Murphy · Answer

@Frank Boenzi - investing in my back yard. We have 12k units and 44k jobs so my prediction for 2019 is a 100% occupied portfolio, just like 2018!

Dan Farkas · Answer

I attend many seminars and listen to a couple of Economists forecasts and predictions for the upcoming year for the last 5 years.  It helps me explain to my clients where the market is going and what areas to buy, invest and sell in. I am happy to say that these economists have been accurate for the past few years and has strengthened my already established professional opinion about the market. I also am exception another year of 100% occupancy rates in my rental units.

Dan Farkas · Answer

Reach out to me. I do not have my itinerary set up for the show but i will definately be there for a few of the sessions.

Sam Shueh · Answer

2019 will be a great year with lower transactions. The market is now generally slower taking a bit longer to get stellar high offers. A little (5-10%) price correction is good for insane local price gained sine 2012. Average selling price is $1.2M or high end at >3.9M.

Flip can be more difficult as the margin is <10% often with a price reduction.

Everything is tied to economy. People are starting leaving in social media, cell phone, failed startups. Tesla is laying off 1000 employees here to boost Musk's ego.  Later on 2019 not so sure about the economy which drives housing prices.

Frank Boenzi · Answer

@Dan Farkas Thank you for sharing! I will be at the RPOA event.. very excited about it!

Dan Farkas · Answer

@Frank Boenzi sure. I listen to Dr. Paul Isley the associate dean of undergraduate programs at GVSU. He talks frequently around Grand Rapids throughout the year. I think he will be at the RPOA event coming up soon.

Also Dr. Alan Beaulieu from ITR Economics and co-author of Prosperity in the age of decline Has been chatting at the annual Greater Regional Alliance of Realtors broker meeting every year also.

They are both good to listen to!

Frank Boenzi · Answer

@Ray Johnson Correct me if I am wrong but I have heard more millionaires are made in recessions compared to any other time. For obvious reasons a crash is never good considering people lose jobs, houses, families are destroyed but for people in a position to capitalize its a great thing!

I am here in Grand Rapids, Michigan and have come across people and investment groups who bought 50-100 properties here for anywhere from $2,500 - $30,000. My neighbor across the street bought his property in 2011 for $15,000 and has it rented for $1,400 a month. Guy next to me quit his job in 2008 and bought 10 rental properties. He bought his duplex next to me for $34,000. There are currently 0 properties listed in out market for less than 50k (minus two that are auction properties). Livable decent property will run 120,000+ in Grand Rapids now and thats 10-11 years later.

In a recession, how do you decide what markets you would want to take the plunge on? What are a couple key things you focus on when deciding?

Frank Boenzi · Answer

@Dan Farkas Care to share some Economists you like to follow just for everyone else who would like to learn more; including myself!

How will your market do in 2019?

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