The Game
Another opportunity local to my area has shown itself. It’s funny how these opportunities blossom, only to shrivel up and die more often then not.
No doubt, the game has changed. What makes opportunities tough to get done is the constant rule changes. When rules like loan qualifying, short sale approval, and seller expectations keep changing, even the most steadfast buyer cannot make it happen.
I hear a lot of folks stating “cash is king”. It’s a fun buzzword and people like to say it a lot about real estate investment. They believe great deals can be purchased for all cash. I have not found this to be true.
All investment decisions are based on ROI and, more importantly, IRR. The big draw to real estate is the availability of leverage which allows you to multiply your ROI. In absence of this, ROI suffers, often times leaving you with an average investment you could beat by investing in other markets.
Until leverage becomes readily available, real estate will continue to be ostracized by the investment community.
Does this mean time to get out? Heck no! Being the investor who can see when financing comes back will position you to make incredible returns when the pent up demand for commercial real estate returns.