It's clear there is one thing on every real estate investors mind these days: The Economy. Richard Fertig at Short Term Rental University recently held a 2022: State of the Economy Webinar. You can watch a playback of the event HERE. Below are 8 takeaways from the webinar I think you will find valuable:
Cut the fat – only buy the essentials. Let’s be intentional with our spending to conserve as much cash as possible.
Don’t switch jobs if you can help it – now is not the time to mess around with job security and your income. Let’s dial back the risk to weather the storm together.
If your HELOC is your safety net, and you can afford to make the monthly payment on your interest – consider drawing it down and taking that cash as your insurance policy. Keep this as your safety net, and do not spend this money on anything.
In your business, every single opportunity you’re contemplating needs to have extra scrutiny – do not underwrite to 2021 peak levels; instead, underwrite to 2019. Don’t take on long-term projects you can’t see to fruition.
Don’t get into bidding wars – take a step aside, watch people overpay, and revisit when there are distressed sellers.
Avoid floating rate loans - interest rates are going higher. If you can, lock in a loan for as long as you expect to hold the property.
Avoid bridge loans - they tend to be expensive and short duration. These two things don’t make sense to me personally at this stage in the market cycle.
If you have an underperforming STR or home you are not using – consider selling it now and 1031-exchange into something better positioned moving forward. Remember, we are not married to our positions, and at the end of the day, we are investors.
This content was reposted with permission from the creator. Learn more about Short Term Rental University HERE!