How did multifamily units hold up during the last housing crash?

[Evan Ghang]

Did anyone own any fourplexes (or other multifamily) during the last housing crash in Seattle? If so, would you mind sharing your insights on how it performed during the crash? Did the property value dip X%? Were you still able to maintain cashflow positive without dipping into reserves?

Thank you for sharing in advance!

[John Barrett]

@Evan Ghang I owned a duplex outside of Seattle during the 2008 housing correction.  During that time, I saw the value of my property fall by roughly 20% off it's high.  While this did hurt my pride that the value of my property had fallen, it didn't have any impact on my occupancy and rents actually increased during those years.  I did not have to tap into any cash reserves but I know people who did.  The key determining factor in my opinion was the amount of leverage people had taken on and duration of the loans.  People with fixed rate / longer duration debt were able to ride out the market turbulence.

John