Keepin’ Things In Context — Is Now The Time to Buy, Sell, Exchange?


Usually when we see titles like that about real estate investing, we assume the message will be to take action in one form or another, especially buying. Not so fast, propaganda breath. 🙂 Lookin’ back on my career as an adviser, and with very, very rare exceptions, 30-40% of those asking me what they should do are told to stand pat. You shouldn’t be surprised. Some are in such great position it’d be criminal to change a thing. Some are in such terrible position there’s virtually nothin’ they can do right then that offers a reasonable chance of ending well.

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Not Everyone Should Buy Now, or Make Changes to Their Portfolio.

Regardless of whether the market is welcoming, accepting it’s invitation is simply never universal. It’s about each investor’s specific status quo. Surely this is a Captain Obvious observation, yet so many seem to adhere to a more universal mindset. Sometimes it’s far better to stay on the sidelines as you deal with either adding and/or eliminating various financial/investment factors aimed at improving your current position.

Related: BP Podcast 017 – Finding Mentors, Facing Retirement, and Note Investing with Jeff Brown

The Key is Always to Understand Where You are Now.

When making any real estate investment related decision, whether as an experienced veteran or as a rank beginner, knowing where you are now is pivotal. Your financial status quo can’t ever be unknown to you, even if only a small part. Again, pretty obvious stuff. But in the last month or two I’ve been able to guide several callers/emailers to stop and think about what they’re proposing. Your financial house must not only be in order, it must be protected by overly generous cash reserves, cash flow at every turn, and the ability to deal with Mr. Murphy when he comes calling.

And he will show up at your door. Nobody escapes their turn in his barrel. Nobody.

So, I offer this exercise for you to consider. Start with a blank page, or a blank spreadsheet if you insist. Begin doing a detailed analysis of your entire financial life. Everything is on the table.

1. Household income, before and after taxes.

2. Lifestyle cost: What’s the total outgo of your family, EVERYTHING included?

3. What are your predictable monthly savings after taxes/lifestyle spending?

4. Are there expenses you can cut/eliminate? Is there waste? 

5. How much debt do you have on your house if you’re not renting? 

6. How much debt exists on cars, toys, plastic?

7. What’s your bottom line net worth?

If you learn nothing else with the completion of this very simple exercise it will be where you really stand financially. Once you have that picture — the good, the bad, AND the ugly, it becomes far less likely you’ll attempt something unwise. At least that’s my story, and I’m stickin’ to it.

Know where you are right now. It’s one thing to set a goal to reach your coveted Point B. It’s quite another to know exactly where Point A resides.

It’s always about context.

About Author

Jeff Brown

Licensed since 1969, broker/owner since 1977. Extensively trained and experienced in tax deferred exchanges, and long term retirement planning.


  1. Hey Jeff – A simple but profound exercise. I still don’t know what my wife spends and everytime I ask to do a family budget it usually gets me no results. Married over 20 years so not sure I should rock the boat. LOL.

  2. Jeff Brown

    Simple but profound has been my experience too, and for literally countless investors. I’ve had so many find money and/or ways to eliminate debt they never would have if not for insisting on knowing their real financial status quo.

  3. Robert Steele on

    I take your point. While everyone else around me has been in a mad scramble to buy I have been quietly selling into market strength in order to streamline my portfolio.

    I’ve basically been getting rid of my under performers. I have been using the equity gains in them to pay off the mortgages of others. My cash flow is now 10% higher even after losing some properties because of this re-balancing.

    When things normalize here or things take another turn for the worse I will be positioned with enough dry powder to come back into the market and pick up some gems.

  4. This one’s a gem. I have been telling people to start tracking all their money, assets, and debt on a spreadsheet. You must know what you have and be able to see if it’s going up or down. You can’t succeed without measuring your success.

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