Is now a good time?

[Erika Baker]

I would like to start investing in real estate, single or small multifamily rentals. With the high price of houses and high interest rates, would it be smart to wait until things calm down or just go for it?  I am nervous that I purchase a place, then the value drops possibly, making it hard to refinance - any input is appreciated! 

[Ryan Lesley]

Hey @Erika Baker, 

This is a common question that new investors ask and you will get arguments on both sides. 

I personally subscribe to the notion that "time in the market beats timing the market". In short, no one can tell you with certainty if the market is going to go up or down, but if we look at data for the history of the housing market it has always trended up in the long run. So despite the crashes and spikes we've seen over the last 20 years, there is still a positive appreciation across the board. 

The last thing I will say on this is, since we don't have a way of knowing whether the market will go up or down tomorrow, next week, or next month - we have to base our decisions on what the market looks like currently. So if I analyze potential deals and the numbers work, and I know that the market historically tends upward, then I am of the opinion that it makes sense to invest - especially if you're just trying to get started. 

Investors who have several properties or are sitting on cash have the luxury of being a bit more picky with their investments since they have the ability to contrast the current market against their current investments, and decide whether or not it makes sense for them to invest. But my opinion is getting that first investment, so long as the numbers make sense, is more important than if prices are higher than they were X years ago or where they could be x years from now. 

I hope that helps and wish you the best of luck on your investing journey 🤝🍀