How will the CoronaVirus affect your portfolio?

Question

And how has the FUD factor of the CoronaVirus affected your overall acquisition strategy?

Evan Polaski · Answer

@Jay Helms, no change.  Granted I was starting to get ready to sell off properties given the strong market, and I have slowed that down.  Have one on the market, and decent activity, but the FUD is definitely not helping with pricing.

For acquisitions, nothing seems to have changed.  I still want to buy and still look for deals, like many others, and so there is a lot more demand than supply.  Unfortunately, pricing (and why I am selling) is prices are so high the numbers can't work for anything.  Off market sellers still look at on market pricing for validation on offers, and when on market deals don't make sense, most off market deals don't either.

Jay Helms · Answer

I'm not sure @Anna Catron. Maybe BiggerPockets is hiding my posts :)

This is definitely an oddity scenario that will test the health of your reserves. What is your current strategy?

Anna Catron · Answer

Well, we're still small potatoes, 2 SFRs. But we do have fairly healthy reserves. We are deciding, should we sell (assuming this is the highest value we'll get for a while) and use the profits, or just use reserves when we find properties that are crazy low? We've got a duplex and triplex in the pipeline, so maybe they'll go down in price and we'll use less of our reserves.

What about you? @Jay Helms

What about you?  @Jay Helms

Jay Helms · Answer

@Anna Catron - I have 5 units my wife and I personally own, all with fairly healthy reserves. The 320+ other units we have in syndication are still sending dividend checks as expected. I slowed down on acquisitions after last year due to sticking to my criteria. My current plan is to ride all this out and pick up units when they go on clearance.

Nicole Heasley Beitenman · Answer

I'm not making any changes to my plan. I'll pivot when I KNOW I have to, not when I think I might have to at some point that I'm unsure of.

Anna Catron · Answer

@Jay Helms. Yep, I'm not a shopper, but when assets are on sale, I'm there!

Chris Levarek · Answer

@Jay Helms Expect some possible missed rents from some affordable housing properties, especially with certain evictions being on a 30 day hiatus for the courts(NC), however getting ahead and vocalizing to tenants benefits to paying rent on time will be key. Possibly even offer some gifts to tenants during hard times(next 30 days example), decreased rents for a month or even gift baskets with (tp/sanitizer/food)! Good to give back.

As far as our strategy, we are still putting offers out. Capital is there and properties are still on the market but amount of offers have diminished(in theory), thereby these offers have a better chance getting accepted at what makes sense. We won't be overpaying and most definitely will be keeping in close contact with our financing partners to ensure those options are available at the rates we expect on the back end.

Anna Catron · Answer

Why I no one responding? Don't we all have that question? As the world economy tanks, do we stay the course as long as we have reserves?

Anna Catron · Answer

@Evan Polaski. That's where things might improve.  Increased supply with lower price tags, IMO, is on its way as homeowners lose jobs and can't pay the mortgage.

Will G. · Answer

All depends on if the fed can keep the everything bubble inflated and growing! chances are not good they can right now

How will the CoronaVirus affect your portfolio?

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