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Market has softened quite a bit. California investment in Midwest and southern states is drying up steadily and homes are staying on the market for longer. This is a great time to start putting some money into rental properties, even if you have to sell your stock at current lows. $200k single family homes in Atlanta, Philly, Phoenix burbs etc all rent for over $1500. Basically any MCOL cities that have a growing population and reasonable property taxes. I’m selling a bunch of GOOG when the trading window opens to pick up another 5-7 rentals. It’ll suck to sell at 30% below highs but it is what it is. How are you planning to leverage this recession to your advantage? #personalfinance #investments #rentals #passiveincome
What a BS proposal. First of all, there's no guarantee you'll be getting 1.5k, or anything at all, once the crash is more severe. Evicting people in AZ, GA or FL might be easier than CA, but it's still extra work, plus many simply destroy the whole place. Second, you could have as well done this 5 months ago when the RE prices were still about the same, but GOOG was ATH and loans were ATL.
When prices are low, it’s better to be in RE due to the 4:1 or 5:1 leverage it offers. Have you ever owned rentals or are you commenting based on stories that make it to the news desk?
I'm just pointing out the facts about the timing that you're suggesting. RE investing may be a good opportunity, but the timing to exit the stock and enter RE was maybe 5 months ago.
I’m no financial expert but feeling like this is just the beginning. Before making any large investments I’d make sure you have your home paid off and enough cash / stable investments to weather the storm.
Yup, agreed.
Sold ANZN at 2700,2500.. holding cash to buy more rentals. Same strategy..
Good call!
Would you both be open to share how you pick, manage rentals? Or resources to learn. I’ve been thinking about this but not sure how to get started
Phoenix does not have any inventory in a remotely desirable area for anything close to $200k.
Remember, you’re not living there yourself.
You’d be buying property in areas with pretty high rates of crime and trying to rent that property for a price that no one would want to pay to live in those areas. But hey, go for it and I could be wrong.
Sell low, buy high and buy illiquid
It will go even lower, so sell, hold. Change the asset type to your favorite real estate, when things go even lower. Don’t sell all your stock, but some..
@buybs, yours is an uneducated over simplified comment. Real estate gives you a 4:1 leverage so buying RE when it’s low is a lot more advantageous than keeping your stocks. Like Bond said above, don’t sell all, but sell some.
I’m buying in Ohio right now. Specifically Cincinnati. I agree it’s a great time to buy, but I don’t see prices coming down yet and interest rates are killing cashflow. Atleast rent is trending up though
If you can survive for 2-3 years, interest rates will eventually come down at the other end of the recession.
Not worried about 2-3 years. My only problem is I can’t find deals as good as a few months ago. But I think I just got spoiled with high cashflow. My mindset today is if it cash flows, I’ll buy it regardless of interest rates. Not scared of a 6% 30 year fixed lol
how do you find tenants?
Shhhh
Would you get people to rent if there’s a recession?
Luxury homes, vacation rentals may be harder. But otherwise, rentals are fine .. people who can’t buy at these mortgage rates will have to rent..
When property prices are high, less people can afford so rents are higher. When recession happens, people sell homes and move into rentals and rents remain high.