Don’t let YOUR MONEY go down the drain!

Yeah, I think it’s, I think there might be a divergence within like residential stuff, which you guys work with. And then the commercial assets, like I haven’t seen the run-up in prices in commercial assets, maybe like a quarter point across the board of cap rates, lowering. By the way it’s you guys means that the prices are going up when the cap rates are what they sell for lower, but nothing nearly is like the residential. Well, that’s what I’m like. I lower my like waterline for like people to buy turnkeys to me, buying turkeys make absolutely no sense right now. But so if I were to understand how you’re thinking and summarize it, you’re thinking this is the opportunity to sell residential properties. What do you think? A lot of people in the middle of the pandemic, the summertime, we’re creating a lot of videos, the YouTube. God love them. Right? They’re always doing those tweetable or those SEL terms where the world’s going to end. There’s the way, lots of foreclosures. Is that really going to happen? Where you put, I put my money on that. I think that will be a big disruption. I think I was Dallas, Texas last week for a couple of conferences, had a meeting with some, the manager of the billion dollar fund that we were talking about what they’re thinking and it lines up with I’m thinking this cycle will end and we’re not sure if it’s going to end in six. 12 months, 18 months, but this high that the cycle will end and then it will go the other way. And the managers words, it will lead to an extended period of depreciate. And we’ll see these prices steadily declined. Oh. And his thought was late. This decade, our economy is really weak right now and the fundamentals are not good. I think there’ll be some significant challenges ahead had they’re not reflected in the current real estate market, but at some point they will be. And most of the rosiness today is a result of that. A good chunk of it is government intervention, which is the record, low interest rates are near record low. And then all of the stimulus money that has been pumped into, into the, the economy, uh, over the last year that’s been, I think that’s, there’ll be another side of this that will pay for it. I think. 2000 5, 6, 7. It was such a dramatic run-up there had to be a turn and eventually it turned in late oh seven and through oh eight. And it became a people were at that point, but you got to, oh, nine, 10 people are looking back at oh seven and oh eight and oh six and thinking, what were they thinking? Why did they think this would keep going up? Why were they paying so much for houses? And I think right now, fast forward a year, two years, three years at some point. There’s going to be people looking back and saying, what were they thinking in 2021, people were paying for assets, be it a mortgage or real estate. I’m happy to sell into that market. In fact, I’m thrilled to sell in that market, but I’d be really scared as a buyer I’m having to buy. And I know talking to some of the funds, they have to buy, they have money. They can’t not use it. And as they have to buy, they’re buying with expectations of very modest. Like low single digits that they have here, they’re getting four or 5%. And that is not even three-and-a-half percent people. It’s better either. They have a super cheap cost of capital, which some of them do, or it’s better than not investing the money at all, but I’d be nervous if you buy something and you’re getting three, four, 5% return. And then the market turns and suddenly you lose your road, your principal, that would be challenging. So my thought, if you own real estate or you own a mortgage or any kind of type of asset with the exception of probably hospitality or our office buildings, which are probably you sell in today’s market, you probably won’t do well, but everything else by and large, not residential real estate, anything to do with that, I think it’s definitely, yeah.
Close Menu

Free resources!

1) LP Syndication Guides & Turnkey Rentals

2) Accredited & Pure Investor Networking Opportunities

3) Free Trial of Passive Investor Accelerator eCourse

Join Our Community!

Free 15 minute
Strategy Call

*No sales pitch. Period.