Real Estate: The Time To Buy?

Hanging with friends and yes...real estate

Greetings from Washington D.C.  Yes….I am still here.

Today I spent time with some friends who used to live in New Mexico and now live in the D.C. area.  I also met up with an old high school friend.  It was great to connect….but the realization of how I let time slip by since I last talked with my friends was fast hitting.

It had been twenty years since I saw my high school friend Israel.  I hope it is not that long when I see him again.

But….I digress….

So….

There is a lot of talk that things are getting better with regards to the economic state of our great country.  Well…I do not agree.  We are getting ready to see another wave of sucker punches…but this time from the commercial real estate sector.  Yes….it is true….commercial real estate is going to hit our economy hard.  The question is…. how hard?  With government money trying to soften the blow, it may not be as hard as I previously thought…BUT…with the government printing money at record levels, there will be a price to pay.  The question is….when is that price going to be paid?  My thought?  …..soon.

High School buddy... Israel

None-the-less….lender’s books are filling up with Commercial REOs.  Commercial assets at discounted prices are showing up by the truck loads….So….it is cherry picking time.  BUT one huge problem.  Lenders are not lending.  Well….at least not without a heavy down payment.  Up to 50% on some deals….especially retail…office….industrial.  Apartments still fair better than other commercial real estate…but even that sector is feeling the pinch.  Have you tried to fund a small apartment complex lately?  Seems like only the 2M and above are getting funded these days and that is in only certain areas of the country.

But….there are a few solutions out there as funding gets tough.  I am seeing more and more seller financing as well as reasonable terms on private money.

So…yes…it is a buyer’s market….but building those relationships outside of lending institutions will give you great buying power in one of the best times to buy commercial real estate.

Until next time……rob

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