Once the housing market started to slide in 2007, smart investors began buying, and waiting, for rock-bottom prices to kick in. Investors were buying homes in some of the best markets for dimes on the dollar, and have seen massive profits whether keeping them as buy-and-hold rentals, BRRRR deals, or flips. While small investors started buying a couple of houses a year, institutional investors were doing far, far more.
Private equity funds, along with REITs and hedge funds knew that foreclosed homes were a steal, and their economies of scale made it even easier to turn these financially mismanaged properties into appreciation and cash flow kings. As institutional investors began fixing up these homes, listing them for rent, and later selling them, the entire market moved in an upward direction. Now, first-time homebuyers are competing with these economic powerhouses to lock down their first primary residence or rental property.
A man who has been covering this topic for years is The Wall Street Journal's, Ryan Dezember. Ryan has a keen understanding of what influences the housing market as a whole, why institutional investors are making the moves they are, and what this means for small mom-and-pop landlords. Dave Meyer also joins David Greene on this episode to discuss the ways small landlords can beat Wall Street at their own game.
In This Episode We Cover:
Why home prices dropped to the lowest point in 2011
How the pandemic gave institutional investors more buying power
Who are the “wall street buyers” that are buying thousands of single-family homes?
Why you should “find the tenant” before finding your next property
The “carbon monoxide” of investing that most investors aren't paying attention to
How institutional investors use economies of scale to rapidly rehab homes
What small investors can do to beat institutional investors at the closing table
And So Much More!
Links from the Show
Check the full show notes here: https://biggerpockets.com/show514
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517: 5 Pitfalls When Buying These “Crazy Cash Flow” Properties
516: Are You an Asset or Liability to Those in Your Life? w/ Earn Your Leisure
515: Your Step-by-Step Guide to Buying Out-of-State Investment Properties
514: BiggerNews, October: How Small Landlords Can Beat the Hedge Funds
513: Seeing Greene: BRRRR 101 - Loans, Deals, & Cash Flow
512: From Losing $150k at the Blackjack Table to 7-Figure Profits in Real Estate
511: Getting Your Market, Money, and Mindset Right | 3 Coaching Calls!
510: Work Less and Make More by “Working the System” w/ Sam Carpenter & Josh Fonger
509: Cars & Cashflow: Manny Khoshbin’s Story from Homeless to $1B