What will your investments be worth in five years from now? Waitaminute … five years? Who wants to wait that long?
We all do. Because that’s the real question real estate investors should be asking. Not “Can we 2X this property in 2 years”, which is what many of us have been asking. It is what we’ve been accustomed to, but that’s not today’s reality.
Do you look at today’s interest rates and low loan-to-value ratios as “No thank you, I’ll wait until conditions stabilize”? If you do, thank you, and join the crowd, especially if you’re a buyer! Now hopefully fewer of you are competing for the good properties.
Sellers read the news too. Some will be content to roll in the cash flow, keep increasing rents as much as possible, and sell maybe in another year or two. Some have to sell now, though. They have shorter term debt, they’re fearful of impending doom, or they’re just fat, happy, and ready to hang it up.
If you think buyers like us may be missing an upcoming dip in the market, you might be right. But if you think five years from now we’ll regret having bought now, you’ll be wrong. Smart buying means not overpaying, not taking out short-term debt, and not buying in stagnant markets. Do it right and your patience will be rewarded.