I keep hearing how it is a terrible idea to buy at the height of the market. My premise is that if you are doing a buy/hold longterm then it shouldn't really matter if you are buying at the height. In some parts on California you could have gotten a house for $120k at the height of the market, then they went down significantly but but time the 90's and 00's rolled around these same properties are now worth over $1M. That is not a bad deal at all.
Convince me otherwise.
- Rents can drop
- Vacancies can increase
- Banks can call loans due
- It can be difficult to refinance
So, make sure you have reserves to cover a short-fall and ensure that your loans are long-enough term that you won't have to refi short-term.