I sure wish that “I had bought xyz a year or two ago”. Been looking to buy my “one last building”. Prices in my area just keep going up and up. They sell quickly as well. Often at full price. Rents keep going up as well. Wages are also going up.

Course if I buy an overpriced building NOW , then tomorrow the RE market will drop, right?

In spring of 2000, NASDAQ had a big drop in value. That’s when RE rental units (sale price not rental price) went up 30% literally overnight. Additionally duplexes as well as apartments were turned into condos and thus essentially sold as SFH. Real estate was also being perceived as more lucrative and safer than the stock market. Two reasons why rentals were significantly increasing in value (despite vacancies going up).

Fast forward to around 2007. Real estate prices dropped, again the stock market dropped. Lots of layoffs. Banks no longer had easy loans for anyone with a pulse. Lots of foreclosures. THAT was the time to go crazy and buy lots of rentals at great sale prices.

I realize I am just rambling right now. But I just wish I knew when the next market downtown was coming. Who thought the stock market would still be going up and up? Rents are continuing to go up. Effective minimum wage seems to be rising as well despite our open borders.

Are you buying now or waiting to buy?

Real estate always runs in cycles. It's high now, can't stay high forever.

The caution side of that is that money keeps losing its value, in spite of what the government claims the inflation rate is, and the population will not get any smaller, barring a zombie apocalypse, and everyone needs a place to live.

Down cycles in the past have not been nearly as catastrophic as the last one. Not a crash, just a cycle.

Personal debt dramatically spiked in the years leading up to the 2007/2008 crash. Mortgage defaults exceeded a level that the banking industry and Wall Street could absorb, causing the collapse of many institutions in these industries.

I keep an eye debt statistics, including mortgages, credit cards, student loans, and auto loans. It's not looking good, unless you are an investor with lots of cash.

Google NYC rental prices. TV news article over the weekend has rent prices dropping in a few areas. This might be s bell weather but would take some digging to see what drove the report.

Here at the North Jersey Shore prices are still rising and SFH rentals are at a premium. In our small ish town there is 1...just 1 townhome available.

Good school districts and proximity to the NYC train is key.

I doubt that watching rents will tip you off about a real estate price decline. They aren't EXACTLY in sync.

I've been a LL and a RE investor for over 40 years. In each of the re cycles, re prices went up and down, BUT the rents never went down.

In my state, MA, rents didn't start moving up till the re price cycle was about 1/2 way up. Then they started to cautiously increase.

However, when the re price cycle was ramping down, rents did not follow - they stopped and remained ratcheted up! They did not continue to go up, but they did not decline.

My observations do not include Boston, just the southern and Metrowest area.

We brought several on the court house steps for penny's in todays pricing. 9800.00 for a 2 sty 4bd 3 ba had tenants in it who stayed paying 900 rent. Rent now 1300.

Last outright purchase (not on court steps ) was in 2001.

So how to find deals in todays market--- almost impossible when you have company's like auctions .com. And some Hugh players out there.

Of course the time to buy was when no one could sell-- but many didn't have the hudspa for that-- to risky??? I pulled much money out of my 401 for buying these foreclosure jewels???? was risky at my age butI was tired of working for DA MAN! ya know. and my wife was behind me all the way. She had one rule: only sfh's. As most know we had 80 and are now down to 63 with only 2 mort's left.

TenantWhisperer,

I've been in the real estate game for the past 41 years. I've seen 3 cycles, up and down. The key to my success is to be leveraged but have enough skin in a property so I can "adjust" my rents to the current rental market.

Purchased a huge apartment complex at the height of the market back in 1990, only to see it drop 50% in value over the next 7 years. But the rents only dropped 10%. Since I put 35% down, I could easily adjust my rents to attract good tenants.

When we first moved to our area (2006), we were looking through the newspaper at acreage for sale. "It would be nice to buy some land outside the city limits someday. But it's $1500/acre. We'll wait for the price to drop."

Fast-forward to 2019. Now, you can get $1500/acre if you're buying in parcels of 100 acres or more... if you're looking at 5-10-20-30 or less, it's more like $5k/acre.

If you want something, buy it. If you can't afford it, don't buy it. Buy something for what it can do today, straight out of the gate. If you're not confident in your resources, be conservative. If you're able to be risky, take on a reasonable amount of risk--- but don't endanger your biz.

What would your "one last building" bring to your biz that you don't already have? If it's something good, commit to it and get the good stuff pinned down. If it's something that would be nice, but isn't necessary, then keep your funds liquid so that they're not tied up in something mehhh when something fabulous appears on your radar.

I'm still working my way through my current queue of projects. I wrapped up a 2018 acquisition last month, and am working on a couple of turnovers-- one of which has a significant renovation attached. (Reroofed and replumbed the entire house, now am putting it back together. It should be back on its feet by the 4th of July.) I've got one last 2016 acquisition that needs a total renovation, plus a pair of 2017's. Depending on income/handyguys, I hope to get one of them put to bed before the New Year, and make significant inroads on a second.

1988 to 1998 bottom of that market

1998-2006 prices going up

2006- 2013 low prices

2013 to 2020 end of that RE cycle, prices going up

Markets vary. With the crash here, rent dropped by about 50% and took years to recover. It wasn't good time to have a big mortgage to pay.

Tenants lost jobs. All of the construction workers moved away. Businesses closed, middle management moved away.

On top of that, the area was over-built, so there were lots of houses to try to fill with the reduced number of tenants.

To OR Woodsmoke, your first post got me thinking again about the RE and stock market cycles particularly.

It seems like for the past 20+ years we have started seeing much more "extreme" bubbles than ever before. Much higher high markets and then much lower lows than we would have ever thought. I believe you are older than I, so maybe you could lend your perspective on this particular phenomena.

Rents in my town are decent for now, but there has been a LOT of construction the last few years. Driving around, I'm still seeing LOTS of for rent signs, mostly with one or two numbers on them, but not always.

At some point, I'm planning on another multi, and I have the lot ready, but I'm going to give it a little longer and see how things go at the U.

We've been told that we should expect layoffs at my U. Enrollment is down, even at my STEM based institution, one with very reasonable tuition and fees. Heck, our out-of-state tuition is lower than the In-state tuition in IL. But, our enrollment in FS19 is projected to be about 300 lower than SP19. We have a lot of students graduating, not as many enrolling at all levels.

JB, the last market crash was bad because the government had interfered so badly into the mortgage market and then interfered extremely again instead of letting it sort itself out. So that wasn't just a real estate price cycle.

Prices were driven artificially low so there was a steep climb back to justifiable prices (according to supply and demand). All much exaggerated over what would be an expected real estate cycle.

Deals are getting a bit pricey, I just got out bid on a couple last week.

I can't predict the future, but I do know what things are worth in my market and I refuse to overpay. So right now I'm just selling inventory and holding my money until a good deal comes along.