In this episode, Paul Lizell gets down to the current conditions of the real estate market and what direction it is moving in. Are we at the peak of the market, the start of the decline, or are we going to continue to trend upward? What changes could affect the market? Will rates decrease or start to move up? If you are in real estate or a business owner, find out how can you take advantage of these changes. The market is moving and this is the best time to plan your next steps.
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Planning Your Next Steps In Real Estate
State of the Real Estate Market
We were talking about the state of the market. I want to get into a little deeper dive. First, let’s get into an article from CNBC on Wednesday, July 17th, foreign purchases of US homes declined 36% from April 2018 to March 2019. That’s a big drop and it’s largely due to China. Out of the $77.9 billion purchased for that period from 2018 to 2019, there were $13.4 billion purchased by Chinese buyers. The Chinese government cracked down with tighter capital controls and that was a big factor in it. We also have bad economic news all throughout the world, especially in Europe and China. These people can’t afford to buy anymore. They are probably looking at better deals in their current markets so they’re looking outside the United States.
Real Estate Market
That’s one little additional thing that we’re finding in the state of the market as to what’s driving it. If you look at the median home price of all real estate in the United States, it is $259,600. They paid a median price of $280,600 because they’re buying in New York City, in Miami, some in California and in Seattle. These markets are higher in markets. Look for those markets. It takes a pretty big hit between 2019 and 2020. If you want to invest in those markets, especially in New York City, which already declined, North Jersey and Miami, you’re going to see a bigger decline. Also, look for a bigger decline potentially in Seattle, even though there’s good economic activity up there, good businesses and industry up there.
I’d still think you’re going to have a drop, especially since the foreigners are dropping off. You’re going to see that effect. I’m going to go to the BiggerPockets’ top places to rent. I like Indianapolis. Phoenix, I’m not sure why that’s a good place to buy and hold. It’s tough to cashflow. Raleigh, North Carolina is tremendous. Atlanta’s good market. That’s got heated up a bit. Oklahoma City, that has heated up a bit. Cincinnati, Ohio is excellent. Hedge funds are in these markets. Columbus, Ohio, and Cincinnati, Ohio, that has driven them up a bit, but their rentals are very good. Columbia, South Carolina, I love this market. I buy in this market and I’m surprised it’s not higher on this list to me. I would put it well up.
Cape Coral, Florida, is a good market. It’s pumped up a bit. It’s recovered a bit, but still you can find some values in this area. Louisville, Kentucky and Kansas City are always a great place to find cashflow rentals. There’s info about Black Swans as what they call it. I bought stuff outside of Houston. It has been good. Detroit is a decent market, especially a good cashflow market. Tennessee has been for many years. Hedge funds are in there so be aware. They could drive up the price. Des Moines, Iowa is excellent. Lubbock, Texas is good. I bought there before. Greensboro, North Carolina is excellent. I purchase there before. Savannah, Georgia has always been great as well. I bought it there. Hedge funds or even getting into that area a bit, but that was just a higher-end area. It’s a nice market.
With markets that are always tremendous to be in, Dallas is number one as it should be. Austin, you’re not going to cashflow around a property in Austin very easily. Orlando, you can, depending on where you are. Jacksonville, you definitely can. Charlotte’s great. The price continues to increase. It has been increasing since the ‘80s. Salt Lake City and Provo, Utah, have some good tertiary markets. These are definitely markets for growth. Look for future growth in those markets. You have markets like North and South Carolina that are going to be growing even more over the next two to ten years. These are the markets we need to get into.
Some of them are a little further away from the coast and there are good cities in there with good opportunity, low cost of living, low real estate taxes and very good affordability. These are good markets to be in. There are plenty of good markets in Pennsylvania. If you’re looking in Pennsylvania, that’s a cheaper income tax at around 3.2% state income tax. It’s the tenth cheapest state in the union to buy. A lot of investors would buy. Hedge funds are moving in the Pittsburgh market and it has a little higher real estate taxes. Pittsburgh has different types of buyers and different types of investors. That’s something to think about to give you an idea of what’s going on between us, our real estate and a reduction of purchases by foreigners and how that’s affecting the state of the market.
Areas Real Estate Investors Can Take Advantage Of
I want to talk about the conditions of the market. We’re in a different market than I can remember ever since I’ve been investing. We’re in a market with declining inventory. Prices in some areas still rising, some are stagnating and some falling ever so slightly. Overall, the real estate market is still red hot. It is still mostly a seller’s market even though inventory is starting to creep up a little bit. I want to talk about some different areas where I think as experienced investors, we can take advantage of and profit in the long-term. My mindset has shifted and I’ve added ten rentals. I will add more, probably looking at least double that, if not more. I’ll let the deals dictate what I do with the property. If they’re good and they make sense, I’ll buy and hold. I’ll cash-out, refi and hopefully put a few dollars in my pocket too doing that method as opposed to losing what I would get wholesaling it or fixing and flipping it.
What I’m looking at with interest rates the way they are is we have very low-interest rates. It’s at an all-time low or near an all-time low. Larry Kudlow said, “Rates aren’t going to go up in my lifetime.” If he doesn’t expect rates to go up, he knows they have to artificially keep rates low. Otherwise, the whole game is over. For those of us who invest in for a while, we understand what he means by that because rates used to be natural for the most part. They would go up and down. Rising interest rates would lead to lower real estate values because the less you can afford, the higher the rates and vice versa. With rates staying low, we’re either going to be looking at a pretty flat level or slightly increasing real estate values over a period of time. It has led me to the desire to own some rentals, hold some and hopefully gain some long-term wealth as well as cashflow.
The markets we need to hit in order to make this make sense. Obviously, they need to be in areas where the taxes aren’t inordinate and be in real estate or income taxes. A lot of people are going to invest in Arizona, Florida, Nevada and Texas where it has cheap real estate taxes. There is little to no state income tax. That’s what I’m going to be looking at too. I’m going to be looking at some of the hottest areas. We have areas in and around the suburbs of Philadelphia that have expanded. You have towns that are revitalizing with nicer shops, restaurants and bars. With that being the case, the second flip I ever did in Ambler. I used to pick up properties there for $40,000 to $60,000 routinely. I fix them up, resell them for $130,000, $150,000. Now, there isn’t a property price below $239,9000 in that market. That market is searched. Another one where I was born and raised in Lansdale, PA. That market is also revitalizing, cleaning everything up. Around the train station, they have all kinds of shopping that they’re building, restaurants, coffee shops and bars. This is increasing the values in those areas.
It’s not artificial. That’s a natural thing. People want to be around that. It’s convenient. One, you have shopping, which is great. You have the train station so you can get to the city of Philadelphia easily and inexpensively. There are some good benefits in areas like that. Out in other parts of the suburbs like Royersford, Phoenixville and Limerick, these areas have blown up. There is an old town called Pottstown, which used to be the downtrodden area, the lower-income one. In my opinion, that’s the next one to go up because it’s the next one in the area and two, it’s convenient to shopping. They have a nice downtown with all kinds of stuff. They are close to the city. It has easy access to major roads to get to the city, which is one of the most important things.
I’ve got a couple of rentals in there and I’ll continue to do more. The city itself or the borough has become more investor-friendly over the years. They used to be a nightmare to deal with. The only caveat is the real estate taxes are a little bit higher, which is a drawback, but the cashflow is still there. For example, I have a property that I’m $125,000 into. It rents for $1,450 a month. It’s a good cashflow. I have another one that I’m $60,000 into. That rents for $1,100 a month. It’s a good return on your investment and there’s a good $20,000 of equity in that property as well. These are areas I’m going to target and look to buy more as long as the prices remain the way they are. If they start to really creep up, then I’ll cut back. I’ll look into the new market somewhere outside that area.
I do buy in the Pocono Mountains, Pennsylvania. It is a great area. Those prices have gone up, but not nearly as much as other areas. The cashflow is still there. I’m continuing to look at those markets. I’m going to continue to add rentals down in tertiary cities down Texas, not Dallas and Houston. Maybe San Antonio. I’ve been to some small ones like Sterling City, El Dorado, Tyler, Texas and some other ones outside the major cities. Corpus Christi is becoming a pretty hot area. It’s a great area for growth. If you’re looking at buying hold for five to ten years, choose Corpus Christi. I don’t think you can go wrong. It’s a great area and a lot of businesses around it and a good location.
Those are the type of markets you want to hit and focus on. If you’re looking for a long-term buy and hold, if you’re looking for wholesale, those are going to be great markets because more investors like myself are looking to go in there. You’re going to have a bigger buyer pool that you may have other markets that are dying markets where businesses are moving out of like Detroit, Michigan even though Detroit is having a little bit of revitalization. People are doing extremely well up there. I think Michigan is an underrated area to buy and hold and to wholesale. It still has that negative connotation from the panic in 2008, but I think it’s still an area that long-term is going to be very good.
These are markets that you can target and look at for the future. They are markets that have growth potentials. One of the things to follow for that growth potential in any market that you’re looking at is where jobs and companies are going to go. Everybody was looking at where Amazon was going to be at. Amazon is up in Allentown. They have a hub there. They were going to go to Long Island, but those communists pushed them out of there pretty well, which is disgraceful for the people who live there. There will be other areas. Amazon’s going to be building and adding more. It’s a big company and they have a great brand. I buy a lot from them. I do a lot with Amazon even though I think they’re too big but unless they break them, they are going to continue to grow and get bigger.
Look for Amazon to get in real estate. That’s widely been rumored. It’s going to happen. They’re going to get in there. Zillow and Redfin are getting in there. They’re pushing realtors out or trying to draw realtors to work for them with a lower commission. I don’t see it as a bad thing. I’m a realtor for myself for investing. I know there are realtors out there that hate this. They make a good living doing what they’re doing. Those people continue to make a good living. They’ll do what they do because they have a great reputation. They move and sell properties. I don’t think it’ll hurt them. What’s going to hurt is your lower end realtors and your middle of the road realtors who are going to have to figure out something else.If you have a big business with a lot of employees and a lot of overhead, now is the time to change it. Click To Tweet
There will be another innovation. There will be something else they can get into. There will be other options so it won’t be the end of the world. Reducing the hold that the National Association of Realtors has would be a good thing, in my opinion. Giving it to Amazon would not be a good thing. Zillow’s going to be taken a bit of it as well as some other companies that’ll be out there doing that. You’re going to have a lot of small mom-and-pop shops. They are going to be all for a 100% commission, reduced commissions and flat fee listings. You might see more flat fee listing companies out there where there will be listings on the MLS and doing it that way. There’d be positives and negatives to this. Realtors bring in qualified buyers or they won’t waste their time with the people.
Growth And The Future Of Real Estate
There is a negative in that you may be trying to sell to people that aren’t qualified. You’re going to have to put it on your realtor’s cap if you’re an investor or a home seller and tried to vet these people. There are easy ways to do that. You just make them come with a prequel and get some information to look at it. That’s where the future is going into real estate. I think we’re going to be good long-term, whether it’s 2% to 8% growth in real estate values per year. It’s going to have to be capped at some point because you hit a point where people just can’t afford it. They end up becoming renters because the amount is too high. Even with 3% to 5% interest rates, they can’t afford a house that’s $300,000 to $400,000 that used to be a $150,000 or $200,000 house.
They’re going to be forced to rent. Rents will go up. That’s one thing I’m looking at. If the values continue to go up, it’s a doable thing. Rent should continue to go up if the values go up, which means my cashflow should continue to go up. Real estate taxes and other costs will go up on with that, too. Try to get a fixed-rate mortgage so you always have at least one thing fixed. Insurance and real estate taxes will go up over time. It should sell cashflow. You should get greater cashflow out of these. Hopefully, you’ll have a bigger tenant pool, maybe some better tenants out there as well as. Everybody knows there are career bad tenants out there who take advantage of the system. I’ve dealt with them and evicted them. I’m getting better at bringing better people in here and setting expectations right for renters so they know exactly what their obligations are. When the payment is due and what are the consequences of the payments not received by such date? Do they have to mow the yard? I let them know that they’re responsible for yard maintenance, snow removal, keeping the place neat and clean. If they’re keeping it dirty and there are things piling up and the township sends me a letter as the owner, I put that back on them. If I get a fine, they’ve got to pay that fine.
If you set expectations, people are generally pretty good about it. The biggest problem people have with rentals is they don’t set extra expectations. They get the people in there and collect the rent. They’re not letting them know what their obligations are, what they need to do as tenants in order to stay in good standing with you. This is something that’s important. We have a program that we’re building. It’s a virtual property management using a VA and yourself. We’re going to have paperwork for expectation set and how to set up online payments that you receive, whether it be through Venmo or another third party that deposits it into your checking account. We’re going to have a program out there. If anybody’s interested in that, definitely reach out to me. Let me know and we can get that information out as soon as it is available. I’m not sure the price point on that yet, but we’ll keep you posted.
Getting back to the future of the real estate market, I think it’s going to be good. I think it’s going to continue to grow. It’s going to continue to have increased rental values as well as property values because rates are going to be artificially low. Look at the stock market. That’s a great example. It was down to 5,500 in 2009. It’s at 2,730 or 2,750 somewhere in that range. It’s not natural. It was quantitative easing that they have this where they’re literally printing money and putting it out cheap money out to the banks. Cheap money is our heroine. Unfortunately, it’s keeping the system going. If they take that cheap money away, you saw the stock market go right down the cliff. It was going badly until they had to come out there. Trump made some comments that the Central Bank’s gone crazy. They came back there. They walked back and said they’re probably going to end up reducing rates when the market normalizes. It starts to continue to go up again skyrocketing in classic symptoms of a drug addict. The drug being low-interest rates, cheap money, which gets us in to be able to buy a ton more assets. We’re going to have a lot of inflation with that. Who knows if it’s going to be slow quick? It’s been fairly slow, but if you look at the stock market inflation, that’s been pretty rapid.
In real estate, that’s been pretty rapid. I did not think real estate was going to turn around as it did, but to keep the rates as low as they are with the job prospects improving for people over the years with more manufacturing jobs, they’re being brought back. It’s a good thing but it’s also a fake thing. If the dollar loses value and the ten-year T-bond goes up, mortgage rates are going to go up. That’s long-term mortgage rates, not the short-term ones that are based on your home equity line of credit. They are two totally separate items. Your short-term rates are based on the prime rate for your home equity line of credit or your business line of credit. They can control that and keep that down. In order for them to keep the ten-year T-bond down, the Federal will not continue to buy more debt. If you do that and continue to buy more debt, then basically what you’re going to have is inflationary on your market.
It has happened where we’ve seen the results of it in real estate and also in the stock market. That’s going to continue. I wouldn’t be surprised to see the Dow near 28,000 or 29,000. Maybe even approaching 30,000, which would shock me a little bit. We’re only talking 2,500 away to get to that. It didn’t take long to get there. Don’t be surprised. I don’t have anything for the stock market. I’m fully invested in real estate and cryptocurrencies. Cryptocurrencies are the future of commerce for us down the road. They’re going to be a means of exchange and the dollar is going to be used less. It may be a baseline, but we’re going to use Bitcoin, Litecoin, Ethereum and some other cryptocurrency out there. We’re going to start utilizing that to transact real estate and for other basic transactions. For those that didn’t know, Amazon already has that thing set up for Litecoin, Bitcoin and for Ethereum to accept that as payments. They’ve already got that stuff set up and are working on logistics. They are trying to keep the cost down but don’t be surprised if you see an Amazon coin coming up down the road. Libor is already coming out from Facebook. I wouldn’t touch that stuff. I don’t like Facebook even though I utilize them for business and family stuff.
I don’t trust Zuckerberg. I don’t trust anything about Facebook. A lot of people love it. I think that will end up going up at cryptocurrency and they’re going to use that as a means of exchange for people doing on the marketplace so you could literally buy real estate through the marketplace with Liber. That could be a good thing for people. We’ll see if that ends up being the case. Maybe we’ll end up using it, even though I’m against that company. That is the future. I don’t know when that future will be for cryptocurrencies. They need to make that virtual while it’s better and easier. You shouldn’t have to memorize twenty seed words or have twenty seed words written down to try and get back in there and move your money. They’ve got to make it easier.
If it’s not easier to do, people will not utilize this. It will stagnate and take longer for it to become mainstream. It’s becoming more mainstream in Korea. Koreans love it. The Asian and the Japanese market love it. They are utilizing it at a much greater rate than we are. Eventually, we will get there. Our kids will utilize that every day in the next ten years. I know I will be as soon as it can be utilized. I’d be a crypto billionaire, but it is what it is and I’ll slowly get there and I’ll keep investing in real estate because that’s my primary and use some of the extra funds and keep dollar-cost to average and cryptocurrencies.
We’re going to end up having some guests that are cryptocurrency people, but most of them are going to be real estate first and then cryptocurrency second. If we have enough demand, we’ll bring crypto people on. That would be up to the audience, what you decide. Reach out to me and let me know what you want as an audience because I want to bring you what you want. I don’t want to bring just some crypto guy on if nobody wants to. I do think that’s the future and I could see it in the short-term. As soon as that adaptation happens, as soon as they make these wallets easier to use, and you do something based on the phone, then it’s going to be a lot easier and better. If grandma has to remember twenty seed words and has to go on a computer to do this, it’s going to be a nightmare. It’s going to be almost as simple as using an app.Markets that have growth potentials are the markets that you can target and look at for the future. Click To Tweet
I think the value is going to continue to rise over the years. Whether you’re a wholesaler, rehabber, wholetailer, note person, note buyer, seller, note creator like I am, it’s going to be good. It should be good. I’m not going to give you investment advice, but that’s the way I feel. I’m going to be investing a lot in real estate. I’m going to be doing a bit more buy and hold, but I’m still going to be doing my fix and flips, my wholetailing, owner financing and I have a nice balanced portfolio.
What Investors Should Do In The Current Cycle
We’ve gone through the state of the market, so let’s talk about how to take advantage of the current market cycle that we’re in. We’re starting to decline. Figure out what’s good for you. I’m still doing my wholesaling. Wholesaling’s going to be the majority of my business. I’m going to do a little shift. As I pick up these properties that cashflow, I’m going to keep these properties. I’m going to do less rehabbing, more localized with rehabbing, smaller scale. I want to do more wholetailing. I don’t want to get into a bunch of big, large rehabs that have a lot of cash out. The reason I don’t want it is I want to be as cash-flush as possible. I’m picking up these rentals. I’m refinancing them as quickly as possible.
The reason I’m refinancing them as quickly as possible because while the market’s still good, the interest rates are still good. There’s still a good variety of lenders out there who are willing to lend me. I want to take advantage of that and get as many properties held in very inexpensive financing for as long as I possibly can. By doing this, I’m hoping to one, create cashflow and two, for long-term, over twenty years period build equity in these properties and have them pay down. They’re going to be my forced savings account or pension plan for me. They’ll have some costs along the way, but long-term they should go up and the value of the property should go up and the mortgage balance should drop. I’m going to be creating some forced equity there.
That’s one of the things I would be doing in this market. While the MLS still has low inventory and it’s still somewhat of a seller’s market out there, depending on what market you’re in, I’m going to be buying and flipping to the MLS as many of these properties as I possibly can. I know they’re bank-owned. A lot of these were already listed, but I’m getting them substantially cheaper than what they were listed at. I’m putting them on the market at a discount. I’m hoping to wholesale but get a little bit more than wholesale free on those if I can, if there are issues with them, maybe do some small-scale stuff like minor plumbing, paint or carpeting. It’s basically to wholetail to the biggest extent that you could do it.
Maximize my profits, minimize my expenses, minimize my time on these properties, and continuously turn the properties over, that’s strategy number two. Fix and flip, I’m going to do a few of those. Maybe six years or maybe twelve tops where I’d be in one month. I don’t want those to be large scale either. I want those to be smaller or medium scale fix and flips. I’m going to continue with the owner financing model that I have been utilizing it since 2012. I’ll find these inexpensive properties, get them to another investor, then run Dodd-Frank because you’re selling it to another investor. You’re not selling it to a homeowner as much as you possibly can who either is going to keep it as a buy and hold rental or fix and flip themselves. Some of them are shorter-term financing. Some of them are going to be a little bit longer-term financing. That’s another method I’m going to be utilizing during the changing market cycle.
The next thing I’m going to continue to look for rural properties, properties in the mountains, the hills that are less populated areas. I’ll find these properties at a deeper discount. The cities will get hit a little bit more than a rural area as well because the price hasn’t gone up as much as they have in the big metro area. Two, you have far less competition. That’s why you’re going to have less increase in that. The market’s not going to get hit as bad. If we have a downturn, it’s going to be negligible. In a small-town America market, you’re going to be able to cashflow properties. They’re generally going to be lower taxes, lower maintenance and generally a better buyer pool. People are there in long-term and they’re not buying like they do in the metro area. Overall, that’s a safer market to be in the economic downturn. Other markets that I feel are good to be in and always are markets like St. Louis, other cities in Missouri and Kansas City. Some of the smaller towns in Dallas, Texas, those shouldn’t have any downturn. One, they got business and continuing to build crazy and companies are moving to their left and right so that the market should continue to expand. There are other markets that are similar to it. Alabama has different markets. Birmingham for example, is expanding because you have different auto industries and companies moving into these areas which are bringing jobs.
The Pocono Mountains, I’ll continue to tap forever because they have so many different companies moving there and creating new jobs. Most of these jobs in the Poconos are not just short-term jobs. You have seasonal jobs up there with ski resorts. Pocono Raceway is one of the things there. These companies are year-round and they’ll continue to have jobs there. That’d be a big positive in those markets. Also, just south of the Poconos is the Allentown area, Lehigh Valley area and Amazon has a warehouse headquarters there. That’s one of their potential areas where they could do another main hub for their business there. They’re not just in Seattle. They’re doing a couple of other areas as well. I think Nashville might have been one of them. I’m assuming they’re going to do Texas at some point.
These markets are going to be good markets to be in because one, you should have appreciation because you’re going to have jobs there. There were also places where you’re going to be losing appreciation like New Jersey, New York, a lot of the Northeast States that have high state income taxes, high real estate taxes and higher costs. People are going to be fleeing these areas as they have been. They’ve been going to Texas, Florida, Carolina, Georgia, Alabama and Tennessee. These no income tax or low-income tax states are going to see mass exits from the higher income tax states tech to these states. That’s where you should see nice appreciation.
There are a lot of guys out there that have big businesses, a lot of employees and a lot of overhead. I’m here to warn you, it’s time to change it. You need to flip that. You need to cut your overhead as much as possible, cut all unnecessary costs, cut all people that are a problem. Shrink down and minimize as much as possible. Go to as much as to a VA outsourcing system as you can. Get lower-cost people in there. You may have to retrain but it’s going to be very worthwhile for you. This is the time to cut the cord and do that and scale your business down and cut your costs so that you’re going to be one more cash-flush. You’re going to run a little bit better operationally as well and it’s going to go much better for you for the future. Get your systems and process and in place. Write down everything, do the mind mapping, know what each job entails.
Have it in a book and then second, record what you do on a task basis daily. What do other people do? Have them record it so that they, in essence, become your training videos for your new employees or your virtual assistants down the road. We train our VA’s through online videos that we send them. It’s the easiest, best way to do it. If they don’t know, if they don’t remember, they don’t have to call me because there’s nothing I hate more than phone calls. I can’t stand when my phone rings because it’s not allowing me to get things done. It’s something that could’ve just been done in a text or an email and save me the time I have to do that. Make sure your people, your employees, your friends and family aren’t wasting your time. Your time is the most important and the most valuable resource you have. Don’t have meetings about meetings. Only have meetings about important things. If there’s nothing good on the docket to do, cancel the meeting. Have them get back to business and do something productive rather than sitting in a meeting and eating donuts and coffee. That’s definitely something else I highly recommend.Rent should continue to go up if the values go up, which means your cashflow should continue to go up. Click To Tweet
This is for people who have businesses established. They have a good income and are bankable. Go to your local bank, whatever bank you use. Ask for an increase in your line of credit. If you don’t have a line of credit, go for it. Apply for a mobile bank. Try to get as many business lines of credit as you possibly can. Home equity line of credit against your home. Get in a position where you’re going to be cash-flush for the next market downturn because when this next downturn hits, you wouldn’t be able to buy. Secondarily, hold these properties for a period of time. The ones that are worthwhile holding are in decent enough shape that you can rent fairly easily and be able to build some equity and sell them maybe five years down the road when the market corrects. Who knows how long the next downturn last and how long will it take the market to correct? It could take twelve to fifteen years or it could be five years. It could be a couple of quick year recovery.
If you’re not bankable, find as many private lenders as possible. Put them in place. When you do have deals coming, offer them a decent return on their investment. Make it better than what the stock market is. A lot of people are nervous about the stock market. They should be because it’s going up so much over such a long period of time. Most people feel it can only go down. A lot of companies are overvalued. There are a lot of things that are overvalued. It’s been a resource of cheap money when you have cheap money and low rates, they’re talking about having interest rates go negative soon. It’s going to be even cheaper. It’s the heroin that keeps the whole economy going but in the stock market, real estate market and everything else.
If you’ve had an entity, whether it’s an LLC or corporation for two to five years, it may be time to discard that entity and start a new one. There’s always that factor, and I always feel this too, with the banks. They want to see that you’ve been in business forever. If it’s the same business, you’re just discarding it, but doing the same business, you just created a new entity you needed it for insurance purposes, you can always explain it to the banks. They will get that. They will understand that. They’ll understand you’ve been in business for a long period of time, even if the entity itself is newer. It’s a conversation that’s a pain to have with the banks, but it’s something that’s important for you to do. If you’ve done a lot of rehabs in the past and anything could come back to you. If you discard that entity, you’re going to be covered. If you have that entity still active, then there’s going to be potential issues that could hit you some lawsuits. Lastly and most importantly, drink a lot of coffee. Coffee will keep you going. Without coffee, I don’t know what I would do.