I still really, really feel good about buying investment property right now. My searches continue to show more and more properties falling into my price range AND there are lots of price reductions. With these market conditions and the awareness that the low interest rates won’t last forever, I am certainly motivated. However, due to all the negative issues that I discussed yesterday in association with my net worth, the timing is simply not right from a personal standpoint. Thus, I am putting the official search on hold.
I still have hopes for doing this at some point, but right now I would need owner-financing to achieve this goal, and that’s simply an unlikely scenario given the circumstances of many sellers in this market.
Also, there is the potential for the real estate market to get worse. On a local level, living near a large state university and hospital, there is a lot of fear regarding significant cuts at the state level that will trickle down and cause many people to lose their jobs and potentially glut the market with homes for sale. On a macro level, if there are significant changes or the elimination of Fannie Mae and Freddie Mac, then mortgage interest rates will surely rise as investors demand more compensation for taking on the default risk. This surge in rates would continue to depress the real estate market and force sellers to lower prices even lower.
In the meantime, I will continue to look for ways to build liquidity to take advantage of whatever opportunities are down the road.