Market risks on buy and hold properties

[Nick Bleser]

People are talking about the real estate market changing. We know it cycles but how does that effect the buy and hold investors? If the market is going to turn soon how can the market effect properties I've already bought and plan to hold? Can it effect the pool of renters?

[Tommy Sowell]

We started buying rentals 23 years ago and since then the value of my properties has gone up and down. One triplex I bought in 1994 was foreclosed on by the bank before we bought it at the loan price of $200K. We paid $120K in 1994 since then the value went up to $750K at the height of the market in 2006 then fell to $400K. But none of that matter to me since I live on the rent prices. In 1994 we rented each unit for $350 which just enough to covered the mortgage. Today each unit rents for $1400 that is where the money is.