InvestorLoft Real Estate Investing Blog

While the vast majority of what we hear these days about real estate in the news is “doom and gloom,” there’s definitely an upside that few are talking about. We’ve entered an era where America is on sale – we haven’t seen such a favorable buyer’s market in years. Property prices in many areas are below market rate, rents in those areas are above market rate, and non-traditional financing is become more and more prevalent and the options for investors to access quality rental/investment property are abundant. So tell me – why isn’t the majority of the media talking about the sunny side to the foreclosure across the street?

Fear.

Fear sells. Fear motivates. Fear is what we thrive on.

The most powerful thing we can do is tap into that fear that everyone’s trying to instill in us and glean powerful information from it.

If a city is experiencing a higher than normal foreclosure rate and population statistics are remaining constant – wouldn’t that mean that there’s a steady demand for rental property from displaced homeowners?

If inventory is plentiful and driving prices down yet vacancy rates in the area remain low and constant - wouldn’t that indicate an opportunity to access prime rental property at reasonable prices with a steady flow of at-market rent rates and tenant supply?

If credit is tight and traditional loans are harder to come by – wouldn’t that lend a look at less traditional financing methods like self-directed IRAs? The power to become a cash buyer is within your reach if you know where to look.

There’s a silver lining to every gloomy cloud in the sky and the real estate market is no different. Our CEO, Wally Charnoff, was recently interviewed by Jonathan Burton at MarketWatch about this exact subject. Have a look at the video and see what Jonathan and Wally found to chat about.

Real estate is priced to move

What exciting times these are for real estate! In my opinion, this is one of the most opportune times in history for real estate investors and the Realtors who learn how to service them.

Real estate investors—go buy something! The illiquid lending market and foreclosure crisis have worked together to create an ideal market for real estate investment. Real estate is on sale, rental prices are at a premium and the market is flooded with quality renters.

It’s as simple as:

Low Prices + High Rents + Abundance of Renters = Cash Flow + Long-Term Appreciation Potential

Do you know what the number one reason is for missed opportunities and failure to meet financial goals? Procrastination! I used to teach a class on this in my investment advisory days. It is easy to find reasons to procrastinate, and below are three of the most common procrastination “crutches” I see used.

Is the market at the bottom? When investors try to wait for the market bottom, they usually miss out. Why? Because the best indicator that prices were at the bottom is that they are trending upward – and thus the bottom gets missed. If you buy with a long-term hold strategy, it’s less relevant if prices are at the bottom and more relevant that prices are lower than they are going to be at some point in the future (which I think, given today’s market, is a pretty safe bet).

How do I finance a property in this illiquid market? There are many innovative ways to finance investment property purchases and I’ll talk about a number of them in future posts. One of my favorite ways is to leverage the buying power of your IRA funds (and yes – it’s legitimate, legal and easier than you think). I would venture to guess that about 70% of Americans don’t even know this option exists, however, so I’ll be discussing this more in future posts.

What if I am not an “expert” real estate investor? The answer is simple: find credible, knowledgeable professionals to assist with your real estate investment transactions. While qualified, professional assistance is no substitute for performing your own due diligence, the team you assemble to help you can go miles towards helping you achieve your specific investment goals with opportunities that make sense for YOU. There are plenty of investment-savvy Realtors who can help you bridge the gap from novice to seasoned investor while you get a few deals under your belt. The sad reality is that most would-be real estate investors buy books, tapes, videos, and advice from self-proclaimed “gurus” but never get to the part where they actually buy a property.

I am adding an IRA FAQ section to InvestorLoft.com where our SDIRA experts will be happy to answer any questions you have related to SDIRA real estate purchases. Questions for me? Feel free to send them over to me directly at askwally@investorloft.com.