My name is Mike Ramos and I am a Newbie to Real Estate investing and I live out in the greater Los Angeles area, looking to Flip, BRRRR and do Vacation Rentals in Cali (especially SoCal), Nevada and Arizona. My question is for all the Hard Cash and regular Lender Pros out there. Are any of you concerned with lending your money (especially to newbies) in our current economic climate? Regardless if the numbers reflect a "good deal" or not.
My mentor who I have known for about 4 years now (but only this week reached out to him to begin my real estate journey with him as my guide) is a conservative guy and is currently my only gateway to accessing hard cash if i need it. But he is hesitant to buy in the current economic atmosphere and is anticipating a significant correction to the housing market within the next 6 months and is not looking to buy anything until the spring of '21 when he feels this climate will be subdued. Meaning he wont partner with me on a buy unless the numbers are VERY VERY in favor of, at least, breaking even. Which is his prerogative I am not mad at him for that.
How does everyone else feel about buying right now with all this economic uncertainty? Where are all the markets that are thriving with deals during this crazy time in the world?
Let me know what you all think.
I think there is nothing to worry about. The best time to buy real estate is always now! Time will always fix any issues you run into as long as you plan accordingly and hold on for the ride.
@Michael Ramos I have to agree with your mentor. We were looking to purchase a few months ago & we were stalled by bidding wars. The place we bid sold for $50k over asking price. It is very much a seller market now. With many ahead uncertainties, we don’t even know what’s gonna happen after moratorium is lifted. At least it is safe to say...let’s wait till next year. We would not want to purchase a rental property & no one is willing to rent due to high price. Everyone wants a COVID deal. My renters asked if I can go in forbearance so that they don’t have to pay several months. Or should I say they are entitled for some free rents. I was livid! But I couldn’t kick them out due to moratorium. So I had to reduce rent. So Let’s be real here...to get a decent area, you have to pay closer to $500k for SoCal. And that’s bordering to classB & C area. And you’re lucky to get 4% financing. The only way is to find foreclosure or short sale below market. If so, you’ll enter bidding wars all over again.
@Michael Delgado It all depends on the location. Even during the housing crash some markets didn't really feel much and actually bounced back quick. But right now, I think it's just so different that no one can really predict. On one hand you have businesses shuttering left and right. On the other we have a wall of over 6 trillion dollars that will eventually trickle down the economy. And thats just 2 factors. As for me, I stick to buy and hold investments so I am always looking for deals. Just do your full research. Good luck!
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