Let’s pretend it’s the recession - attack my portfolio

[Joe Delgrosso]

I hope everyone loves a good hypothetical worst case scenario like I do!

I was listening to the BP money podcast today and heard another recession story from ‘08. It always makes me wonder - how can my portfolio be affected by the next recession. I think it’s safe - but I’m sure everyone else in 08 did too!

Below is a rough summary of what I got - would love to hear any crazy or not so crazy idea on how bad or good I might have it when the next one hits.

Between the years of 2016-2020 I’ve purchased 6 single family condos in Knoxville, TN. Each one was done with 20% down and 30 year fixed rate.

I currently net $350-$450 per unit each month after all the costs are done. Nothing crazy but it’s been nice cash flow streaming in.

OK...whattayah got?!?

[Matt Castle]

@Joe Delgrosso I survived the last one and bought more during it, but my #1 concern were job losses by tenants. No rental income, harder to pay mortgages. 

Other things like property depreciation are less of a concern b/c it's all paper losses unless you sell it. If you're a buy & hold forever type, then you don't have much concern. 

Since you're dealing with condos, I suppose you have to worry about the financial health of the HOAs. More defaults equal higher payments and greater difficulty getting a refi/HELOC if you need one.