Short Term Rental Riches 14. When Recession Hits, Will You Be Safe?
5 snips
Feb 19, 2020 The discussion dives into the looming question of whether to invest in real estate before a potential recession. It explores who might be most affected by economic downturns and highlights strategies to protect your investments. With insights on how some properties might thrive even in challenging times, listeners learn about the concept of becoming recession-proof. The conversation challenges the doom and gloom narrative, suggesting that downturns could bring unexpected advantages for savvy investors.
AI Snips
Chapters
Transcript
Episode notes
Fixed Loan Shelters Recession Impact
- If a property is bought with a fixed 30-year loan and cash flows well, a recession-caused value drop won't immediately harm you.
- You just endure the downturn and your tenants effectively pay the mortgage over time.
Choose B-Class Properties
- Buy B-class properties rather than top-tier A-class ones for better recession resilience.
- Middle-class renters downgrade during recessions and might boost demand for affordable rentals.
New Builds Are Riskier Investments
- New construction, especially A-class, risks missing market cycles and losing renters in recessions due to high costs.
- Building delays and higher costs from supply shortages intensify the risk for new property investors.