Tips for Surviving a Bubble

[Michael Mignogno]

Hi All, I am constantly seeing discussion that either support or reject the idea that we are in an actually bubble and whether it will burst soon, has already burst, or wont burst at all.  Rather than argue about if there is a bubble or not, what are some tips from experienced investors for surviving a bubble.  Specifically, how can one who owns several investment Multi-family home and SFHs best be prepared in the event of a bubble burst.

TIA

[Theresa Harris]

If you are doing long term buy and hold, just hold on to the properties and keep renting them.  Look back to what happened in the US in 2008 and look at house prices a few years later.  If prices go down, some will buy.  Don't over extend yourself and make sure your expenses are covered by the rent.

[Michael Mignogno]

Quote from @Theresa Harris:

If you are doing long term buy and hold, just hold on to the properties and keep renting them.  Look back to what happened in the US in 2008 and look at house prices a few years later.  If prices go down, some will buy.  Don't over extend yourself and make sure your expenses are covered by the rent.

 Thanks Theresa, this is currently my exact strategy and what I have been told so its good to have it reinforced by a fellow investor

[Jaron Walling]

@Michael Mignogno Deleverage assets (when possible), acquire new debt at a lower LTV, keep reserves for each property, keep tenants happy and paying on time, and most importantly get strict on the buy side of the investment.

Personally I'm trying to follow the buy and hold strategy and unless you live under a rock you probably know it's nearly impossible to do it right now. In my market it's either a flip, negative cash-flowing deal, or so over priced Idk what to call it. That's not my strategy. For those reasons I'm focused on everything I stated above. 

[Conner Olsen]

@Michael Mignogno Lower your leverage and increase your cash reserves.