Investor · Pittsburgh, PA · Member since 2015 · 1k+ posts · 1k+ votes
9y
@Steve S. Steve don't put too much faith in the Media. People will always need a place to live. if the economy crashes and we do another great depression of the 1920s then we are all in the dog house rich or poor. Just make sure when you buy a property you account for high expenses and low rents and if the property still makes sense using those numbers then buy it. If you live your investment career thinking that vacancy will be zero and rents will be high and repairs will be low then you are in for a long bumpy money losing venture.
Investor · Pittsburgh, PA · Member since 2015 · 1k+ posts · 1k+ votes
9y
@Steve S. Steve don't put too much faith in the Media. People will always need a place to live. if the economy crashes and we do another great depression of the 1920s then we are all in the dog house rich or poor. Just make sure when you buy a property you account for high expenses and low rents and if the property still makes sense using those numbers then buy it. If you live your investment career thinking that vacancy will be zero and rents will be high and repairs will be low then you are in for a long bumpy money losing venture.
Sandpoint, ID · Member since 2015 · 68 posts · 37 votes
9y
If anything, I am concerned that real estate prices are too high (because economy is doing well now) and that we could experience another drop in real estate a couple of years from now. The area where I live has appreciated between 9%-13% each year for the last two years so I am no longer looking to buy any properties where I currently live. Now I am focusing on markets that are currently stagnant or have dropped over the last couple of years (mainly rural southeast section of country). If we go through another recession, the cycle where people start losing homes and need rentals will start again so my view is that investing in rental property is a good bet regardless of what the economy does. But like Alex says, make sure the numbers make sense for any rentals you add to your portfolio (meaning don't buy high).
Here's what you need to understand about the housing market:
We're in a housing shortage right now. Some 80% of builder / developers went under in the crash. Some are recovering, most are not. Economists estimate we're still some 5 million housing units behind the demand. We expect to see a return to semi-normalcy starting around 2025, barring anything which would kill the builders again.
Regardless of residential property values, the demand for rentals is strong and will likely continue strong, even (especially) if the economy takes a hit. It's supply and demand at this point.