Plan when the market crashes?

Question

Is anyone willing to share their plan/strategy for how you are going to profit when the market crashes?

Russell Brazil · Answer

The market crashed in 1933 then again in 2009. That puts us on track for the next one right around the year 2085. I should be likely dead then at 106 years old.

Scott Passman · Answer

@Jerid Ladson Depends on what happens and when. No guarantee the housing industry will be effected much by it, and if it is, will have to wait and see what opportunities present themselves. As a general rule of thumb, would seek to be wary of overleveraging in order to keep debt down and keep cash reserves ready to deploy.

Joe Villeneuve · Answer

I think you're forgetting that in today's Global Market, everything moves faster...so I believe the next one should come in the year 2075... but my math might be off.

Brent Paul · Answer

I think it comes down to buying properties smart.  Buying based on appreciation is pretty risky.  I buy based on a minimum of 250 per month cash flow in family friendly B areas near schools.  Most of the time I am around the 400 mark for SFH.  If something does happen and I have to lower my rent by 100 bucks a month that isn't going to affect me really.  The tenant will still be paying my mortgage.  Now those that are negative cash flow or barely breaking even might be in trouble if rents do go down. Let's not forget those that decide to spend their HELOC on things like motorcycles and cars...I haven't seen rents go down yet, but anything is possible.

There are a few investors I know that are paying down their properties with cash flow.

Too many people spend so much time worrying about these things they are talking them out of deals that come their way.  I guarantee those that wait for the market to crash will be the ones missing out.

Todd Powell · Answer

@Jerid Ladson. Keep collecting rents and finding the best tenants out there when units turn around.  I also got my debt load down on my leveraged HELOC loans, so I will look for below market deals to flip most likely. Every market down turn creates opportunities

Shawn Coverdell · Answer

This is one of my favorite reasons to buy Hood homes or what some call "D" properties. When you get a divorce, I have a place for you. When you loose that job, or take up that habit, I have a place just for you. Economy just crashed. Let me show you your new home.

Low end is the low end. Warning, due to priceing, we are short of vacancies.

Strategy: Keep a healthy bank account. Vacation like a fool. Wait for it...………….. Hit that clearance rack when the price is right.

Keep a concerned looks so no one suspects you are winning.

Shawn Coverdell

Homes in the Hood

Steve K. · Answer

@Jerid Ladson “Everyone has a plan until they get punched in the face.” -Mike Tyson. It’s one thing to talk about buying during a down turn, but in reality not many have the balls to buy when there’s blood in the streets. I recently refinanced a property or two so I’m sitting on some cash if a good deal presents itself. I don’t know if that’s a good plan but it’s the best I can do with what I’m working with.

Jim Wollen · Answer

@Jerid Ladson multi-unit

Frank Wong · Answer

I have no idea what the next recession or down turn will do with real estate. It does make me feel better and better reading all this real estate crash talk though.  As for your plan your plan should already be in place. De-leverage increase your cash reserves. Sound simple? It should be.

Russell Brazil · Answer

@Jerid Ladson

Well prices went down in 1991 by $1500. So if around 2027 they go down $1500, I think I will survive.

Plan when the market crashes?

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