Sitting on Equity vs Using It What Are You Doing?

Question

A lot of investors are sitting on equity.

Two approaches:

• Hold low-rate debt
• Pull equity and scale

Both work it depends on the next move.

Are you deploying equity or holding?

John Clark · Answer

Equity is always deployed, because it always preforms a function. It can be used to buy more assets ( using leverage), or can act as a buffer against misfortune (nonpaying tenants, damaged property, etc.). Unless and until you know what you are comfortable with as to risk, you cannot know if your deployment of equity is proper.

Mike Grudzien · Answer

"Are you deploying equity or holding?"Depends on the deal and the numbers.