Is now a good time to invest?

Question

I heard someone notable, I think Patrick David say if you're thinking about buying a house or investing today, invest but make the offer you would make a year from today.

A lot can change in a year ie: home appreciation of 10%+ and interest rates doubling. Assumedly things will one day move the opposite direction..Sure, not all sellers are of yet of a similar mind set or need to sell, but generally it's a buyers market. Property for sale is inventory. An inventory that's value is predicated on what a buyer is willing to pay. Over the most recent property appreciation cycle there were apparently a few two many buyers willing to pay too much.

There are currently robust and strong sales occurring daily along the entire Oregon Coast, but in many recent transactions, my buyers or sellers were only evaluating one offer, and all sellers were at least receptive to a conversation. The reduced demand at least provides more time for identification, education, evaluation, consideration and negotiation.

Also many sellers I've worked with are often invested in the property longer term and so a fair but aggressive or fairly aggressive offer (especially if it's the ONLY offer) is generally well received. Others that have previously been resistant to seller financing have softened or accepted mutually beneficial terms.

Investors and buyers certainly have more options in comparison to recent memory but dare I say... some leverage? A desirable property will always attract quality buyers, but as investors we're trained to reveal potential others don't see, or create opportunity through preparation.

With so many local and external variables, if anything is certain, a good deal on US real estate is, and there seems to be a growing window of actualization for the prudent investor.

The past few week's we've seen overwhelming demand for residential coastal cash flow properties of all valuations with multiple over asking offers. Very strong demand for buildable and affordable lots in the $75-175k range and slowing interest in commercial, retail and industrial.

What are you all seeing and looking for in your market? And do you agree? Is now a good time to buy if the price, terms and property are right? Anyone get a good deal lately? I certainly 'feel' all of my recent buyers and seller are accomplishing their goals safely and profitably. I've even seen a few listings that almost forced my hand.

Perhaps a much more credible and notable investor said it better..

"The BIG thing is that almost no investor has enough money relative to their needs." - Ray Dalio

Eliott Elias · Answer

It's the best time to invest, everyone wants to be an investor when there is tons of competition. What about now when it is easy to find deals and market is shaky?

Nate Sanow · Answer

Yeah it’s a good time… but REI is still personal. I’d say if someone is personally afraid no shame in a few extra months on the sidelines… but using that time wisely to read, analyze, network, learn, grow, etc.

Peter Mckernan · Answer

These are the times when people make the best money and the most money. That might be even better in six months or six days, however, you always have to keep the options open even in changing markets. @Eliott Elias you bring up a good question and statement, people want to invest when everyone else in the market and pull back when everyone else does. Keep yourself in the game, just be more cautious.

Lawrence Potts · Answer

Hey @AJ Wong,

We just closed on a property in Bandon a few weeks ago, my buyers are very happy with it and it’s a huge win for them and the sellers too. And I’ve got others that are looking to play. Those that have the capital and are long-term focused don’t care about the rate, they’ll refinance anyways to get a better return on their equity.

I’ve had a number of buyers that have the means to purchase, can do well with a purchase in today’s market, and can get better terms now because demand has decreased, and they still won’t. One buyer had under asking and closing credit and had the chance to house hack with an adu but backed out, even though the deal made sense on paper. They just got scared. And I can’t blame them, but it was representative to me of some buyer’s mindset and helpful for me to determine if I need to guide them to realign focus or backpedal with them and help them prepare for when they’re ready again. It’s a weird time, but I think the ones that can buy assets now will always win. Because the barrier of entry to buy is so low, we never know when it will tighten up again and when we’ll have this opportunity.

James Bailey · Answer

YES! its always the right time to buy a deal

Bruce Woodruff · Answer

I am actively looking  but waiting until late winter/early spring to buy. I'm taking the view that this will be the lowest price point of this correction. But if I were to come across a screaming deal tomorrow, that's fine too....

Robert B. · Answer

@AJ Wong

I heard a good quote the other day: “Don’t wait to buy real estate, but real estate and wait.”

It’s a long game.

Charles Granja · Answer

If you are worried just get an assumable VA or FHA loan, you can take advantage of reduced prices and low-interest rates. I just went under contract at 2.6%.

Dominic Pizzi · Answer

Some markets are hotter than others right now. For example, as a lender, we are seeing an uptick in the amount of people purchasing/fix and flipping properties in the Midwest and South regions, more specifically Missouri, Alabama, and Ohio to name a few. The question is why? The reason is because many of the properties in these places are already rent ready/do not need any major repairs. What does that do for a buyer? They can automatically start looking for tenants for a property or live in it on their own. And because home prices are seemingly a lot cheaper in these areas, that is why people are looking there more so than anywhere else.

You can enter the market anytime, mostly because interest rates are not in the double digits yet. When these rates come down (because they will come down), more people will refinance. It is basically just a cycle of every 2-4 years that real estate is really good or not going so hot. We are seeing that the really good period might be ending, which scares people off.

There is always going to be someone looking for homes/properties to purchase, there is always going to be someone in need of a rental property. If you are not overreaching on price, it makes all the sense in the world to go for it.

Is now a good time to invest?

Most Popular Reply