New to Real Estate · Member since 2020 · 39 posts · 14 votes
I am just getting my feet wet in real estate and I am curious to know what is everyone thinking regarding purchasing multi family investment properties now during a pandemic?
I’ve been reading and watching videos and it seems like many are leaning towards waiting to see what the markets do. I feel like market can be a bit difficult to time, and seems like many are selling properties to avoid a loss.
Would love to hear from more experienced investors on your opinion: Do you think now is a good time to invest for someone new to real estate or wait it out until 2021?
If you have run the numbers and it appears to be a good deal, then I would go for it. Desirable properties do not come up every day, and when they do, I always want to be ready. If I worried about timing the market, I would have never invested in real estate. Do your due diligence on the cash flow and expenses and analyze deals. Wishing you great success!
Rental Property Investor · Doylestown, PA · Member since 2008 · 1k+ posts · 1k+ votes
6y
@Kendrique Coats - Cash flow is king. Run your numbers and if it’s a good deal it’s a good deal. People have been saying for years that real estate is going to drop and it hasn’t happened. They’ve also been saying for the past decade that interest rates are never going to be this low again yet they keep going lower. The huge bubble here is the stock market. Everyone always thinks in terms of up or down but the other option is years of no movement in either direction. If you don’t factor (or rely on) rent growth or appreciation in your numbers then a flat market for 5 years is not bad at all.
I would be interested in purchasing more if I found a great deal and couldn't pass it up. Currently we have one that we are selling at the moment. If anyone is interested in a SFH in Willingboro NJ please send me a message.
Property Manager · San Diego County · Member since 2020 · 6 posts · 0 votes
6y
Like the general consensus of posts here... if you find a good deal, then buy. In the overall history of real estate, even with the downturns, property values as a whole have always increased. So if nothing else, you can always hold on to the property.
Investor · Edwardsville, IL · Member since 2014 · 142 posts · 54 votes
6y
Me three... If the numbers work then we know what to do. That said it seems just as hard to find good deals as it was a before all this started. If you would've asked me in March I would have guessed we'd be in a big buyer's market by now.
Investor · Chicago, IL · Member since 2016 · 197 posts · 105 votes
6y
A good deal is a good deal, you can find deals in all kinds of economies good and bad. There will always be a motivated seller/s for whatever reason there is. You need to have criteria that you look for in both property type (residential, multi-family commercial, etc), Property class (Class A, B, C, etc), the price you're willing to pay, and the desired cash flow. I didn't mention Appreciation because in this climate that is the thing that is the most unpredictable and cannot be guaranteed (nothing is guaranteed by the way) but appreciation has some skill involved but there are a lot of factors that a person can't control that affects appreciation greatly so I wouldn't count on it, if it happens then it's the icing on the cake. Have a clear vision of what it is you are looking for and when you find something that matches it go for it. Being on the sideline will not help you advance to your goals
I just settled on a new house two weeks ago. I have solid income from guaranteed sources. I'm not worried about the market. But the government takeover of private property is very interesting. This isn't Venezuela so what's the outcome? I predict it will end in disaster for foolish tenants who stiff their landlords. I also think some landlords who don't have capital to see it through will suffer. In my opinion this is unconstitutional. Multiple lawsuits have been filed but you can bet they won't be resolved until after the election. If the Democrats win I think they will offer you buyouts or permanent payments on your properties, sort of a national Section 8. If the Republicans hold the Senate there will still be a deadlock. If Trump wins look for more deadlocks if the House remains in Democrats hands and you're on you're own. Either way you're screwed.
Investor · St. Petersburg · Member since 2020 · 25 posts · 12 votes
6y
How do people feel about this when they look at properties.
I am looking at some properties, a lot of which already have tenants in them month to month or on a year lease. Would you buy properties now with tenants in them? If yes what do you ask from the seller to provide. if not why?
New to Real Estate · Member since 2020 · 39 posts · 14 votes
6y
@Gerry Logan I appreciate your thoughtful response! A lot to think about as we close out 2020. I am here in Central Illinois in a college town so looking at what the future may look like for the 2021-2022 year but the main thing is everyone needs somewhere to live!
New to Real Estate · Member since 2020 · 39 posts · 14 votes
6y
@Quentin Mitchell I appreciate your thoughtful response! The more I read the more I am starting to learn that deals can be found anywhere with a little persistence and accurate analysis of numbers.
Investor · Woodbridge, VA · Member since 2019 · 162 posts · 64 votes
6y
Same, I find myself in Portsmouth all of a sudden. I was looking to rent however the rental properties are flying off the shelves. I'm researching to see how I can buy and running numbers.
North Houston is not worth buying at the moment. Everything is overpriced and the market is saturated with buyers. I am just waiting out the stupidity. On the other side of this we will still have 10% of the population unemployed and ready to sell.
Rental Property Investor · New Orleans, LA · Member since 2020 · 22 posts · 12 votes
6y
I'm finding a lot of opportunities in my market (new orleans). Conveniently, a lot of investors here are out of state short term rental investors. At this stage many of them are being required to make those payments again and looking to offload liabilities. I've come across 2 good deals in the past month that I'm under contract on. I mostly do MF units. Single families here are and have been crazy overpriced if you don't want to be in an iffy neighborhood, which is 75% of New Orleans neighborhoods. The good news, for me, is that this leads to a lot of people renting to get into neighborhoods they could not afford.
I just closed on a SF unit that I'm living in. I would be extremely hesitant to invest in a SF for profit right now, esp in NOLA.
Investor · New Orleans, LA · Member since 2012 · 968 posts · 747 votes
6y
@Michael Watson@Stephen E. I agree. I've had a hard time finding anything lately where the numbers actually make sense. Everyone wants absolute top dollar for properties lately, whether they are on the MLS, an off market seller or from a wholesaler. I haven't seen anything lately at what I would consider a wholesale price.
There is just too much competition out there! And with such limited inventory and so many buyers in the market, investors and retail buyers are all competing for the same properties. This has squeezed margins thin and driven prices up to where the numbers just don't make sense for me. But it seems like there are many others that are willing to take these super slim margins...
Real Estate Agent · Menomonee Falls, WI · Member since 2016 · 54 posts · 45 votes
6y
Interest rates are historic lows, and so is the inventory. Multiple offers within 1 day is common in the Milwaukee area, especially anything under $300k. The 1% rule is unattainable. Folks are taking risks with the frenzy around buying. I am advising my investors to NOT buy right now, but rather invest in their current property portfolios. Money is cheap, but cash flow is hard to attain.
Long Beach, CA · Member since 2020 · 71 posts · 46 votes
6y
I am actually looking to make my first purchase right now. The way I see it, even if prices are high, lending is low. Like most people have said, if the numbers work, why would it not be a good deal. Plus, from my understanding there are a lot of investors sitting on the sidelines with tons of cash waiting for the right time to buy. Just that pressure alone should artificially deflate prices, and then increase them as demand goes up.
One of my favorite lines from Warren Buffet is, " Be fearful when others are greedy, and greedy when others are fearful." While RE investing is not like the stock market, I think the same principle still applies.
I am just getting my feet wet in real estate and I am curious to know what is everyone thinking regarding purchasing multi family investment properties now during a pandemic?
I’ve been reading and watching videos and it seems like many are leaning towards waiting to see what the markets do. I feel like market can be a bit difficult to time, and seems like many are selling properties to avoid a loss.
Would love to hear from more experienced investors on your opinion: Do you think now is a good time to invest for someone new to real estate or wait it out until 2021?
Thanks
The real estate market works very different than the stock market and they are often getting confused. Milwaukee has seen it's hottest market in living history this year, single families have gained 13.4% YoY in August. Now, we are overheated and the market will cool off a bit, we will probably finish the year with +8% median sales price or so.
In other words nobody is selling to avoid losses. Fall is going to be the best bet to snatch up a deal, as we will see inventory drop after Thanksgiving and Q1 is traditionally the most competitive time to buy. We will probably see some pandemic related forclosures as some of the forbearance loans will not perform, but people have equity and will rather sell than foreclose. Regardless it will force some additional inventoy on the market, but I don't think it will be enough to satisfy demand.
The best time is always now; what matters most is that you find a good deal and the numbers work. If the real estate market continues like it looks like it will, you'll be glad you did not wait. I post a monthly market update video for Milwaukee, you can find it on my BP profile page.