I want to start by making a very important point about the competent, well-trained real estate investor. We make money in both the up and down market. We don’t care what the market is doing. We are in with both feet at all times.
However, there are times when we make more money than others. This just happens to be one of those times.
Some of you will look at this article as a warning. A warning to not miss out and live with regret that you did not get in during the best times. It is just that.
I tell you this because I constantly live with regret that I did not start three years earlier than I did. You see, I started investing in 1990. That was right in the middle of the last major real estate collapse. They were great times. However, I look back and wish I had started in 1987. Right at the beginning of the changes that would lead to some of the best deals on real estate in US history. Don’t let this happen to you. Take action and get in the game.
There are basically five reasons now is one of the best times in history to be a real estate investor.
There is a huge shadow inventory of foreclosures on the horizon as banks begin to act on mortgages that are 3, 6 and 9 months behind on their payments. There is another wave of foreclosures coming from the Obama bail out. It is estimated that 50% of the people that Obama bailed out because they where behind on their payments are again behind on their payments. Some are estimating this will increase to as much a 60+%.
This means great opportunity in the coming years for purchasing property 20 to 40% below market value.
2. Low prices
Because of the foreclosures and unemployment prices have dropped. Where we once thought that 100% capital gain was a great deal, we are seeing 200 and 300+% capital gains on all of our purchases.
3. Historically low interest rates
With interest rates in the low 4’s, we are getting more than double the usual cash flow per deal. In the up times, we may buy a house with as little as $200 a month cash flow. Today, the last seven deals I have done have $500 a month cash flow each.
In today’s market, just 10 little rent houses can give you $5000 a month in profit. Could you pay all of you bills each month with that and maybe quit your job or allow your spouse to quit theirs?
4. More renters than ever
Because of the huge number of foreclosures and people losing their houses, more people need a place to rent.
Many people who where thinking that a home was an asset have also begun to realize that a home is a liability. They are no longer willing to jump through hoops to buy a house. They are choosing to rent instead.
5. Higher rents
This one is simple to explain. Higher demand means higher prices. Simply put, because of number 4, rents are going up at historically high rates. As I mentioned, this is increasing our profit per deal dramatically.
Now is the perfect storm for the real estate investor. Take action. Get yourself educated and get going. You will live with regret in 3 or 4 years when the market turns around and you can’t do what we are doing today.