When The Tide Shifts, Ride the Wave
Between Covid, Polarized politics, and Tension around the world influencing supply chains and breaking into an inflation bubble, there is a LOT of unknown.
Chaos can happen from just one crisis and to be blunt, we’re dealing with quite a few of them at the same time. To say we’re all leveling up by necessity is an understatement. We need to understand that Inflation is a thing, Housing inventory is down, Stocks are all over the place and not heading in the right direction for day to day investors. So what do you do?
Recognize the opportunity to stop paddling against the tide. Maybe it’s my California coastal roots talking here, but this flow feels very much like the ocean to me. If we’re seeing a wave coming (Believe me, we’ve seen this coming) start paddling out in front of it towards the shore, so you don’t get sucked into the undertow and you feel the break under you so you can start riding the wave in.
I get that the analogy sounds nice, but if you’ve gotten this far, you’re about to say, “Ok but how?”. Stocks are going down, so you’ve got chances to buy low. Inventory in homes is low, which means equity is high and climbing. It may be time (If you’re already a homeowner) to leverage a little capital for some smart investments or improvements.
Understanding Where We Are and Being Ok with It.
It’s never easy being in a time of unrest. If, however, we know where we are, there’s a better chance of flourishing through the time and season. It’s also important to understand that this is not going to be over anytime soon in the short term. BUT, these cycles are exactly that. They end. So ride the wave and don’t fight it. When you get into the shore as it crashes gently into the sand around your steady feet. THEN it’s time to paddle out again and get ready for the next wave which will be totally different.
Some of the examples of my own wave riding are opportunistically following trends and still helping others.
One Of the Cool Focus Points
Helping families who’re relocating has actually become a majority of my projects. This is one of the reasons I’m glad I got my license in all the states I operate in. Nevada is next up & then I’ll probably be done for a while due to all my continuing education. I’ve already been closing projects in Indiana, Tennessee, and Arizona to name a few.
One of the many take-aways from COVID is the ability for people to work remotely, move to a cheaper location & level-up their lifestyle. 2020 to current has been straight up tumultuous.
First, we had the great resignation - including yours truly!
Shortly followed by the great relocation.
Using Fresno as an example, home prices have skyrocketed since people who work in tech (eg. Apple; Google; etc.) can work remotely. This means, they are making the same income that they needed to "make it work" in San Francisco. Now, they recognized the opportunity to pay cash for homes (or significantly over the listed price) outside of the high rents and mortgages in the original location they were hired for.
My opinion on this topic? If you can do it, more power to you. One of my friends moved to Nevada giving himself the equivalent of a thirty percent increase in take-home pay JUST from the income and property tax difference. With Facetime, quick flights, etc. it’s not imperative to live in a certain radius forever anymore.
Another focus has been from those same intelligent investors wanting more bang for their buck. They aren't being tied down to one location and are moving towards the idea of vacation homes.
You only live once & creating life memories should be one of the main driving factors.
One of the fallouts from the 2008 housing market fiasco was that home builders were on hiatus due to the glut of foreclosures, depressed property values & slim profit margins. What this has caused is a generation of people who are ready to purchase homes without enough of them in inventory to choose from – hence the current madness.
It’s going to take another decade to recover from this and housing to keep up with population growth. Having a second home for the family to enjoy, is not only fun, but a sound investment for your future and portfolio differentiation.
Want more insight on riding the wave and taking advantage of any market? Reach out!
