Investing in Uncertain Times: 5 Tips for Recession-Proof Real Estate Investing
For most Americans, financially uncertain times raise many questions, few answers, and oftentimes cycles of stress and worry. While the thought of investing during a period of economic uncertainty can be fear-inducing, with the right approach it can be an excellent time to build a strong foundation that will benefit you and your family for years to come. With nearly 20 years of real estate investing experience under my belt, specifically in the single-family rental space, here are five real estate investing tips that I’ve seen withstand even the most treacherous economic storms.
Understand Market Conditions and Their Potential Impacts
Understanding the market can seem daunting, especially in current times, but it is critical to develop a baseline understanding as you begin your investing journey. In order to improve returns and minimize risk during a recession, you must work to learn about what market conditions are typically favorable for real estate investing and from there, establish what market conditions make you feel most confident as an investor. Today the market is showing signs of recession paired with high inflation. Although inflation can bring about questions of whether to sell or hold onto an asset, real estate investments can often serve as an inflation hedge meaning that holding onto an investment, rather than selling, often leads to consistent returns.