Is it a bad time to invest?
Member since 2023 · 15 posts · 7 votes
Is it a bad time to invest?
Most Popular Reply
Lender · Eugene, OR · Member since 2021 · 245 posts · 154 votes
3yHi Kazumi, welcome to the forums!
The effects of a particular president (or even governing party) would likely be small on the major economic forces that drive real estate. Presidents actually have little effect over the larger economy (positively or negatively) that the preside over.
Interest rates are a real concern for investors, especially us in the NW with prices where they are. The demand to live here, coupled with the lack of supply will govern housing prices for the next decade, and insulate the region from a larger drop, even if other parts of the country drop (which I don't believe will happen, at least not like 2008)
An investment property should be looked at as a long-term investment, one that lasts through many economic cycles. If you have high short-term goals for cash flow or appreciation, there's a fair amount of risk. But that risk diminishes over a longer horizon and real estate is fantastic in the long-term.
Whether you invest should depend on your short- and long-term goals. Time in the market beats timing the market.
69 Replies
- Real Estate Agent · Portland, OR · Member since 2022 · 16 posts · 13 votes3yKazumi, let me know if you and your wife would like any help finding or looking at a property. I'm a local agent. :)
Quote from @Kazumi Boyd:
Quote from @Emily Van Siereveld:
Quote from @Account Closed:
@Kazumi Boyd my one regret about investing in real estate? Waiting. The stars will never align. The time will never be perfect. The only thing that matters is that the numbers work. So keep looking until you find a deal where the numbers work and start. Waiting won’t help.
Yes, we are looking for first property in Portland.
- 3yPeter MckernanBusiness MemberResidential Real Estate Agent · Irvine, CA · Member since 2013 · 2k+ posts · 1k+ votes
Quote from @Kazumi Boyd:
Hello friends. My wife and I live in Oregon and we want to buy our first rental, but the interest rates and the housing prices in Portland are very high. A 3-bedroom house starts at $450k. But I'm getting the feeling to wait until after the election to see who gets into office before we pull the trigger. Without getting political here obviously if we remain on the current course of policy we will see another crash like we saw in 2008. Am I overreacting? Should I proceed with looking?
If you got a good deal and the numbers workout.. No not at all.. The real big investors or investors that are comfortable in any market are the ones that still do deals. Make sure you know it's a deal even in a bad market or go direct to a mentor that can help you confirm that it's a deal.
The McKernan Group4.954 Reviews - Contractor · Chicago, IL · Member since 2016 · 4k+ posts · 2k+ votes2y
Hey @Kazumi Boyd - It's NEVER a bad time to invest. Period. IF you invest in the right deal.
I try to follow Warren Buffet's philosophy "Be fearful with others are greedy, and greedy when others are fearful"...
Now is clearly a time when others are fearful...
I am an active buyer here in Chicago just being more mindful of the deals we choose to invest in.
Quality Builders4.966 Reviews - Investor · Sarasota, FL · Member since 2015 · 39 posts · 39 votes2y
Quote from @Jonathan Klemm:
Hey @Kazumi Boyd - It's NEVER a bad time to invest. Period. IF you invest in the right deal.
I try to follow Warren Buffet's philosophy "Be fearful with others are greedy, and greedy when others are fearful"...
Now is clearly a time when others are fearful...
I am an active buyer here in Chicago just being more mindful of the deals we choose to invest in.
Oof, man Chicago... with that crazy mayor you had, and the far leftist policies have caused more crime, poverty and illegal immigration. The future of Chicago is not looking bright on those fronts! You're not concerned at all about any of that? I don't believe Warren Buffet's philosophy applies here, not when outlook is a continued decline!
What exactly are you buying/investing in over there?
- Real Estate Broker · 3412 S. Harlem Avenue Riverside, IL 60546 · Member since 2015 · 6k+ posts · 5k+ votes2y
@Darius Parsia how do you invest with all the hurricanes in Florida? Surely its a bad place to invest right??
Like everything, real estate has a lot of nuances. I agree with @Jonathan Klemm that Chicago has a lot of great areas to invest in. It is the 3rd largest MSA in the USA, so you have a LOT of different neighborhoods and suburbs to choose from. - Real Estate Agent · Allentown, PA · Member since 2023 · 9 posts · 6 votes2y
There is no such thing as a bad time to invest especially if you are planning to buy and hold.
- Real Estate Broker · Chicago, IL · Member since 2014 · 2k+ posts · 1k+ votes2y
Quote from @Darius Parsia:
Quote from @Jonathan Klemm:
Hey @Kazumi Boyd - It's NEVER a bad time to invest. Period. IF you invest in the right deal.
I try to follow Warren Buffet's philosophy "Be fearful with others are greedy, and greedy when others are fearful"...
Now is clearly a time when others are fearful...
I am an active buyer here in Chicago just being more mindful of the deals we choose to invest in.
Oof, man Chicago... with that crazy mayor you had, and the far leftist policies have caused more crime, poverty and illegal immigration. The future of Chicago is not looking bright on those fronts! You're not concerned at all about any of that? I don't believe Warren Buffet's philosophy applies here, not when outlook is a continued decline!
What exactly are you buying/investing in over there?
In lieu of dealing with political rhetoric on this post here are the Real Estate facts about the Chicagoland market and why it's a great place to invest. And When I say Chicagoland I mean Chicago and its surrounding suburbs.
1. It's the 3rd largest MSA. So what does that mean as a Real Estate Investor? It is not one market but 100's of submarkets with various opportunities depending on your strategies
2. Rent prices are steadily rising in Chicago proper. The link is for downtown Chicago from May of 2023, but the statistics bear out for the entire Chicagoland region. As a Real Estate Investor, this is the type of data we like to see. The data also reflects the diversity of the market. 78 sub-markets in the city of Chicago. If you count the suburbs there are well over 200 submarkets
3. If you're a buy-and-hold single-family investor the median sale price of homes across the region has gone up 27.5% over the last 5 years. If you're a buy-and-hold small multifamily investor the median price of those products has gone up about 30% over the last 5 years. These are macro numbers and numbers for each submarket will be different. So combine rising rental rates with a large market of renters and values going up over time. It's a target-rich environment for real estate investors.
4. If you're a commercial investor- There are some vacancy rate challenges as there are in all big cities as we recover from the pandemic. For example at the beginning of the pandemic, downtown Chicago vacancy rates were 13.4%. As of this post vacancy rates are still above 20%. With that said there are multiple areas where major investments are being made in new apartment buildings. Why? The city and the area are target-rich environments for renters as the 3rd largest MSA in the country. If you invest in the right syndication you could potentially benefit from those investments
To the question of what are people buying and investing in Chicago? What improves a city and an area are corporations that decide to invest in a community to create jobs along with both small and large Real Estate investors that provide housing to those that choose to live in the community. If you know what you are doing Chicagoland is a target-rich environment for Real Estate Investors.
- 2yAlan AsriantsBusiness MemberReal Estate Agent · Philadelphia, PA · Member since 2019 · 1k+ posts · 1k+ votes
time in the market always beats timing the market
buy in a solid area, focus on appreciation and solid tenant base that will take care of your proeprty
Cash flow is near impossible to find.
You will make your money 10 years down the line, when property appreciated, rent increased, and possibly rates went down
Alan Asriants - New Century Real Estate 590 Reviews - Member since 2023 · 15 posts · 7 votes2y
Quote from @Pierre E.:
@Kazumi Boyd
Thank you, Pierre!
Everyone says cant time the market
Everyone says its always a good time to invest in real estate
I think those are true… but I also get that until you are at a deal flow of a certain level, you dont have enough ammunition to “take shots” at a regular pace… and if you dont really have a regular pace… or if you have ONE bullet for a year or maybe 3 or more years…. How should you use that bullet? Its like in the wild… do I use the bullet to kill a bear charging at me, which might be never? Or do I use it to take down some elk and eat well? Or do I save it and try to hunt with a bow and traps?
I don’t have YOUR answer… but my answer as I had thought about this… keep moving forward. You cannot predict what ill happen, but you (me) should always do one of two things… take action… or prepare to take really good action. Theres not as much glory in the preparation… but what I realized is if I have a plan, and I am strategically preparing to exceute that… im ok. It not the “Key action” I want but its action to prepare for the next key action.
If I am saving up to be able to buy a great deal, or if I have specific criteria, or if I decide I am going to pay down debt while I learn how to do out of state investing… including using some funds to get resoucres do training or find mentors etc or fly and build a team somewhere.. I am preparing for action. If I am jjust holding my bag and waiting for the market to change… thats not preparation. Unless I have very sepecific clear reasons, and high probability, and a plan.. I need to be doing more than that. Whatever my next key action should already be decided, and then I build toward it no matter how long it takes.
In the wilderness example…. It would basically be preparing for two key actions at once. If there is enough food to eat without sing the bullet, keep doing that. Then fortify my self and area to defend against a bear to reduce the need for using the bullet like that. Eventually, it will come to the point where either theres absolutely no need for the caribou, so i hold the bullet, or theres no need for worrying about a bear…
That is how I currently look at it as a rookie. I dont have seasons advice to give you… just sharing my own situation.
(Currently one goal is to learn how to invest out of state, so i go where the market is best for me, and then two, is reduce the bottlenecks and create a plan to scale, both to reach a goal of financial independence via real estate)
Good luck!
- Member since 2023 · 15 posts · 7 votes2yThank you, Melissa!
Quote from @Melissa Nash:
It's never a bad time to invest. The good thing about real estate investing is the Math is the Math. So when you run numbers a positive return is a YES and you should invest. Because that is only 1 reason to invest. The reasons for investing are much more than just cashflow, that is 1 tiny tiny part.
1. You invest because your money sitting in a bank is loosing $ every year bc inflation is high and your dollar is going down in value.
2. You invest because they are not making any more land.... so land always goes up in value
3. You invest for tax benefits - the ones that the wealthiest people in this country created
3. And you invest because the tenant is basically buying you a free house........ and you get all the benefits.
4. There is a reason the wealthy are wealthy. They created the rules.
5. Money is cheap... even at 7%... borrow that money and invest!!!
Best of luck!
- Member since 2023 · 15 posts · 7 votes2y
Quote from @Crystal Smith:
Quote from @Kazumi Boyd:
Hello friends. My wife and I live in Oregon and we want to buy our first rental, but the interest rates and the housing prices in Portland are very high. A 3-bedroom house starts at $450k. But I'm getting the feeling to wait until after the election to see who gets into office before we pull the trigger. Without getting political here obviously if we remain on the current course of policy we will see another crash like we saw in 2008. Am I overreacting? Should I proceed with looking?
Should you proceed with looking? Yes & No. Regarding no- I'd encourage you to study the market more. There's more to Real Estate than single-family home rentals in Oregon. You can explore multifamilies, commercial, and syndications,.... Although I have not been to Oregon I imagine there are Single family homes available for less than $450K in the state of Oregon. I put State in bold I imagine Oregon has many different submarkets where there may be opportunities for much less than $450K. Note: $450K is most likely the move-in ready owner-occupant homes and maybe you should be targeting homes that are not move-in ready and need improvements.
Regarding Yes- In my opinion trying to time the market is a fool's game. With the exception of flipping single-family homes, we've always considered the market a long-term play. Long-term for us means making our expected returns in 5 years or less. Also when we invest we try not to rely on one exit strategy. So yes- invest for the long term.
Regarding the 2008 crash & the upcoming elections- You should create a business that is not dependent on who's in office or can quickly pivot no matter who is in office. Waiting to see who's going to be elected means you'll always be waiting.
I’m looking for rental property. Thank you for Crystal!
- Member since 2023 · 15 posts · 7 votes2y
Quote from @Crystal Smith:
Quote from @Kazumi Boyd:
Hello friends. My wife and I live in Oregon and we want to buy our first rental, but the interest rates and the housing prices in Portland are very high. A 3-bedroom house starts at $450k. But I'm getting the feeling to wait until after the election to see who gets into office before we pull the trigger. Without getting political here obviously if we remain on the current course of policy we will see another crash like we saw in 2008. Am I overreacting? Should I proceed with looking?
Should you proceed with looking? Yes & No. Regarding no- I'd encourage you to study the market more. There's more to Real Estate than single-family home rentals in Oregon. You can explore multifamilies, commercial, and syndications,.... Although I have not been to Oregon I imagine there are Single family homes available for less than $450K in the state of Oregon. I put State in bold I imagine Oregon has many different submarkets where there may be opportunities for much less than $450K. Note: $450K is most likely the move-in ready owner-occupant homes and maybe you should be targeting homes that are not move-in ready and need improvements.
Regarding Yes- In my opinion trying to time the market is a fool's game. With the exception of flipping single-family homes, we've always considered the market a long-term play. Long-term for us means making our expected returns in 5 years or less. Also when we invest we try not to rely on one exit strategy. So yes- invest for the long term.
Regarding the 2008 crash & the upcoming elections- You should create a business that is not dependent on who's in office or can quickly pivot no matter who is in office. Waiting to see who's going to be elected means you'll always be waiting.
I’m looking for rental property. Thank you,Crystal!
- Member since 2023 · 15 posts · 7 votes2yThank you, Peter!
Quote from @Peter Mckernan:
Quote from @Kazumi Boyd:
Hello friends. My wife and I live in Oregon and we want to buy our first rental, but the interest rates and the housing prices in Portland are very high. A 3-bedroom house starts at $450k. But I'm getting the feeling to wait until after the election to see who gets into office before we pull the trigger. Without getting political here obviously if we remain on the current course of policy we will see another crash like we saw in 2008. Am I overreacting? Should I proceed with looking?
If you got a good deal and the numbers workout.. No not at all.. The real big investors or investors that are comfortable in any market are the ones that still do deals. Make sure you know it's a deal even in a bad market or go direct to a mentor that can help you confirm that it's a deal.
- 2yEudith VacioPro MemberReal Estate Agent · Chicago & NWI · Member since 2015 · 860 posts · 521 votes
Hey @Kazumi Boyd - almost every housing market is up right now, if you are ready and can afford the house, then it's not a bad time to invest. But also maybe explore other options like a townhome or condo. That might be a better fit for you. I'm pretty sure there are people that waited to buy 1 year ago, thinking that prices would come down and look what happened. Prices continues to rise! the deals are always out there, especially NOW because those that are selling right now with these high interest rates are motivated sellers.
- Member since 2023 · 5 posts · 2 votes2y
Quote from @Chris Watkins:
Hi Kazumi, welcome to the forums!
The effects of a particular president (or even governing party) would likely be small on the major economic forces that drive real estate. Presidents actually have little effect over the larger economy (positively or negatively) that the preside over.
Interest rates are a real concern for investors, especially us in the NW with prices where they are. The demand to live here, coupled with the lack of supply will govern housing prices for the next decade, and insulate the region from a larger drop, even if other parts of the country drop (which I don't believe will happen, at least not like 2008)
An investment property should be looked at as a long-term investment, one that lasts through many economic cycles. If you have high short-term goals for cash flow or appreciation, there's a fair amount of risk. But that risk diminishes over a longer horizon and real estate is fantastic in the long-term.
Whether you invest should depend on your short- and long-term goals. Time in the market beats timing the market.
This is false, dangerously false.
POTUS has a huge effect on economy as investors should know. Clinton destroyed the auto rebuild market which went from being a billion dollar industry to almost completely extinct in a few years (I know I was making $350k a year and then couldn't make a dime). Obamacare destroyed thousands+ of small businesses while big Corps pushed for it because they could afford to take the hit knowing it would put more of these smaller companies out of business creating larger market share for them to cover the increased cost (Mafia tactic). Obama "cash for clunkers" program was the start of insane car pricing from MFG's. Trumps China Trade War hurt importers (I am one, trust me it hurt us bad). Mortgage rates are high because the FED has increase rates under encouragement from Biden Admin plan to drive inflation down. I can go on for days about the effects of a President over the economy.
All of these things affect the economy at large.
- Member since 2023 · 5 posts · 2 votes2yThis is a half truth. The only way to make this true s to compare it to a year that makes it so. Austin is down YoY but still up from years past. Austin trend is down, not up. People who bought in 2021-2022 in Austin are backwards on their equity!
Quote from @Eudith Vacio:
Hey @Kazumi Boyd - almost every housing market is up right now, if you are ready and can afford the house, then it's not a bad time to invest. But also maybe explore other options like a townhome or condo. That might be a better fit for you. I'm pretty sure there are people that waited to buy 1 year ago, thinking that prices would come down and look what happened. Prices continues to rise! the deals are always out there, especially NOW because those that are selling right now with these high interest rates are motivated sellers.
If you bought in 2021-2022 or even 2023 it may take more years to recover and gain making it a bad investment. You can make more profit today just holding cash than on rental properties! - Member since 2023 · 5 posts · 2 votes2y
Quote from @Alan Asriants:
time in the market always beats timing the market
buy in a solid area, focus on appreciation and solid tenant base that will take care of your proeprty
Cash flow is near impossible to find.
You will make your money 10 years down the line, when property appreciated, rent increased, and possibly rates went down
True, IF you are patient and spend the time to master your local market. Just buying a property thinking it will go up in 10 years is dangerous. In 2008 it took 5 years for the bottom to occur and 5 more years to recover. So in 10 years you would be back to zero. If the pandemic had not happened many of those people would still be under water on their properties!
- 2yAlan AsriantsBusiness MemberReal Estate Agent · Philadelphia, PA · Member since 2019 · 1k+ posts · 1k+ votes
Quote from @Account Closed:
Quote from @Alan Asriants:
time in the market always beats timing the market
buy in a solid area, focus on appreciation and solid tenant base that will take care of your proeprty
Cash flow is near impossible to find.
You will make your money 10 years down the line, when property appreciated, rent increased, and possibly rates went down
True, IF you are patient and spend the time to master your local market. Just buying a property thinking it will go up in 10 years is dangerous. In 2008 it took 5 years for the bottom to occur and 5 more years to recover. So in 10 years you would be back to zero. If the pandemic had not happened many of those people would still be under water on their properties!
It's true that you can't bet on something like this to happen, but usually 10 years is enough for Real Estate to recover. National home prices recovered from peak during the housing crisis in about 5 years.
In 10 years, 2017 the average house price was about 80k higher than its peak in 2007 (322k)I think 10 years is a very safe projection.
Again anything can happen and our dollar can turn into the Argentine peso, but thats mindsetAlan Asriants - New Century Real Estate 590 Reviews
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