Posted by Ed Garcia on May 07, 1999 at 11:30:34:
Mark:
Well said.
In all markets cash is King. Mark, you hit a bulls eye with your advice.
Ed Garcia
the next recession – how to thrive in it ? - Posted by chris
Posted by chris on May 07, 1999 at 02:07:23:
I’m fairly new to this biz & all I know ( in relation to this endeavor ) is low intrest rates, low inflation, low unemployment and general stability. But this isn’t going to last forever , the economic cycle hasn’t stopped turning. … What oppurtunities will show themselves when slower economic times happen. What techniques can we , as creative real estate entrepreneurs , take advantage of ? …I don’t think the Y2K problem will cause “chaos” like some smart people say ( Jack Miller for one ) , but I do think it will trigger the long awaited recession to finally close this long cycle of expansion. One thing that’s great about our business is that we can make $ in any economy, I just have to investigate the specifics of how.
Re: the next recession – how to thrive in it ? - Posted by Robert McNeely
Posted by Robert McNeely on May 09, 1999 at 07:46:02:
A recession may help reduce the trend of our best tenants going out and buying houses. I have had several long term tenants buy in the last year. Just a thought.
Re: the next recession – how to prepare for it ? My opinion. - Posted by Tim Jensen
Posted by Tim Jensen on May 08, 1999 at 09:09:36:
Chris,
I happen to agree with everyone here that in bad times cash is king. Heck, everytime cash is king.
The way you will thrive in it is to keep your cash. If you are planning on buying rentals, make sure that you steal them. I mean 60% of value. The reason is simple. When bad times hit, people lose their jobs and can’t pay rent. This in turn may make you have to lower the rent to get a place filled. If you have all your places financed to the hilt. You may be in big trouble. So just be alert to that potential problem. In some cases, the no money down deal may bring you down. The same goes with some L/O’s too.
If I was just starting out, you may want to consider sticking to just buying and selling places and build up a nice pile of cash. That way when the recession hits you are sitting pretty.
The storm is coming. Do you got an umbrella?
Tim Jensen
Re: the next recession – how to thrive in it ? - Posted by Rob FL
Posted by Rob FL on May 07, 1999 at 16:03:03:
Another thing about RE in a recession is that this will generally trigger an increase in foreclosures and bankruptcies due to higher interest rates, higher unemployment, and other factors. It also will increase the supply of sellers needing to sell the properties creatively in order to unload them.
As everyone below has put so well. If you have a cash during this time, it will almost be like mining gold when you go after the properties. Robert Kiyosaki says that recessions are when the big transfers of wealth truly occur.
In a recession, cash is Emperor! (nt) - Posted by John(NH)
Posted by John(NH) on May 07, 1999 at 14:51:10:
.
Cash is king - Posted by Sean
Posted by Sean on May 07, 1999 at 12:38:26:
And not just in a recession! Cash is ALWAYS king.
Re: the next recession – how to thrive in it ? - Posted by Mark (SDCA)
Posted by Mark (SDCA) on May 07, 1999 at 10:39:40:
Very simple. Have cash. In a recession, cash is king. Everyone panics. Sellers and lenders most of all. This easy money financing will dry up. Buyers will dry up. Sellers will have far fewer options. (Because the few buyers who DO want to buy may not be able to get financing.) Those who do have cash or access to financing will be able to get tremendous deals either from the seller or the bank who takes it back from the seller who ran out of options.
Here is my advice:
Now is the time to clean up your credit, gen up any cash you will need to purchase on the cheap in the future. Continue to look for deals but be more picky and do take advantage of the current easy purchase money available.
Hope this helps,
Mark
Thanks for an Interesting post. I would like to know too… - Posted by Dean (IL)
Posted by Dean (IL) on May 07, 1999 at 10:16:22:
nt