There are many people out there that have been waiting for several years for the housing market to take a downturn.
There are also a lot of investors that have been dreading it.
Well, it is finally here, the housing market is cooling off and a lot of real estate investors who were after a quick buck are now losing money.
What this article is about is how to survive the downturn and possibly even make a profit on your real estate investment.
1) Turn your property into a rental.
If there are fewer people who are willing to put down the money on an expensive house, then it stands to reason that there are more people that are going to be renting.
Think about it, those people still need a place to live, and you can become their landlord.
Just make sure that the rent will cover the mortgage until the market turns around again.
I would also recommend that you find a property management company to take care of the place while it is being rented out.
They will typically charge around 15% of the total rent, so make sure you add that into the rent.
2) Refinance while you still can.
If you purchased your house a few years ago when the interest rates were high, you will definitely want to refinance while you can.
There is nothing worse than trying to sell a home while you are paying a huge mortgage on it.
Try and get the mortgage to a lower level if possible, making it easier to ride out the bad times.
You need to act on this quickly however, while the interest rates are still somewhat low.
3) Get rid of your property now! If you are willing to take a hit while you can still handle the loss, then get out of the market while the getting is good.
The "House for Sale" signs are starting to pop up all over the place, so you need to get your property sold as quickly as possible to limit the amount of damage that will be done if you try to sell later.
You might even be able to make some profit if you act quickly enough.
4) Develop multiple streams of income to soften the blow.
If you are a savvy investor, you probably already know about multiple streams of income and their benefit.
The real estate market, or any market for that matter, should be your only source of income.
The more sources of income you have, the more you will be able to handle any potential problems that occur in one set of them.
The housing market has changed, and if you don't change with it you will be left with a much smaller bank account.
I wish you the best of luck in your investments.