I’m mentally flashing back to this stunningly simple quote from one of Howard Marks‘ books on investment risk.  My news feed is overflowing with the convergence of coronavirus discussions, stock market fluctuations, and now oil market fluctuations.

It appears the Bull Market is over and the Bear is hungry.  And really angry.

Just a few weeks ago, investors were Hi-Fiving each other and comparing the growth of their net worth sheets.

Now, they cringe opening their portfolio apps.

But real estate investors…..ahhhhh……those savvy souls are slowly rubbing their hands together.  Landlords and real estate investors have been waiting for this inevitable time to arrive.  The time when real estate prices start to float back down into more reasonable cost basis range.  The time when Sellers aren’t as scarce as honest politicians.  The time when they can deploy their cash and go buy more properties as rentals.

Unlike the stock market, rental properties are here to stay.  Rental properties are not as sensitive to the short term whims of the stock market.

Not everyone needs to buy a new car.

Not everyone needs to order a new computer.

Not everyone needs a new espresso machine delivered by Amazon.com.

But everyone, at least everyone above the dirt, needs a place to lay their head down at night.  Everyone needs a home.

So, with this concept firmly planted in your head, take 3 deep breaths, drop your anxiety-filled shoulders down a few inches, and repeat after me:

“Trees don’t grow to the sky and nothing goes to zero.”

It’s still going to be a great year….IF AND ONLY IF you have the 4 sides to your real estate business intact to defend against the angry Bear.

  1. Insurance
  2. Finances & Accounting
  3. Operations Management
  4. Legal

Get these 4 sides as solid as possible.  You’ll ride out the killer waves without taking on too much water in the boat.

And remember to breathe.

 

 

 

 

 

 

Dan Baldini

P.S.  Not sure how to get your 4 sides intact?  Here’s a simple solution:  https://danbaldini.com/resources/private-client-consulting/