Thursday, August 06, 2009

Real Estate Investing and the Recession

Do the rules change for property investing when there's a recession on? Yes and no. No because if you have a solid foundation of rules then they are going to serve you well no matter what the situation. For example if you have decided that you will not purchase a house unless it is returning at least 10% on its purchase price then that's a pretty good rule no matter what the state of the economy. Yes because you might want to change this rule so that you will only purchase a property investment if it is returning a minimum of 12% on its purchase price.
During a recession you can probably get these sort of returns and even better if you really go hard.
However whether you want to tweak your rules during a recession and the consequential housing downturn or not, there is one indisputable fact about a recession. If you have funds available for property investing then you are in a great position to purchase the bargains that inevitably hit the property market. And if you're really keen you can by-pass the real estate agents and advertise for houses yourself. It's amazing how many desperate people who are out there that want to deal with you rather than a real estate agent. They see you as a savior and someone who is going to save them money. As long as you stick to your rules and make it a win-win deal you will be laughing. All the best in your property investing.