Keeping with post GK Masterminds tradition rather than sharing my thoughts I’ll share notes this week
You have to be careful of the people making predictions on the economy. Those in power (government) walk a tight line between telling you the truth and not causing mass panic.
If you have a good enough reason to buy or sell real estate then it’s always a good time to buy or sell. The economy should have nothing to do with if you buy or sell real estate. You can’t predict when things are going to happen. Timing the market isn’t possible.
We have our models but the economy is the back drop of the world in which you buy. It should dictate IF you buy or sell.
Today we are at 3.6% unemployment. It’s a confusing number for “us” because there are more jobs than those who are looking for them. People resigned and didn’t go back to work in a traditional setting.
Some people are choosing not to go back to work and others are coming out of retirement because they can’t afford the inflation.
The GDP for the country on an annualized basis is higher than it’s been since pre 1990. This represents all of the goods and services that were sold in the country. On a quarterly basis Q1 the GDP is a negative number. The government wont call a recession until the second month of negative GDP. Which will happen in Q3 for Qi’s number.
Inflation and supply chain issues are causing the economy the be fragile. Most people are projecting that inflation will get reined in by end of 2024.
When you get in to a situation like a recession you should start throwing everything out and getting a grip on your expenses. Start NOW and dont wait until you’re having an issue. Higher interest rates and inflation aren’t really slowing people down yet. They have to keep raising rates until it stops you.
Gary thinks rates will end up between 7-8% to stop inflation.
You shouldn’t allow this environment to dictate WHAT you do… it only dictates HOW you do it. You have to just grab your shorts and hold on. The average number of every recession is only 9 months (of free fall) until the market finds it’s bottom.)
Don’t be afraid of the upcoming recession. Be afraid of your ability to adapt fast enough. You should look at your business and making sure you are recession proofing it.
If you’re average and you’re giving average effort you will see your production drop by 20-40%. OR you can Buckle up and go get your unfair share and drive people out of the business.
It’s rarely the fault of the economy or industry if you lose money….. it’s a timing issue.
Everyone should be looking to have a property management division right now. As rates go up more people will be renting vs buying.
If inflation is prohibiting people from saving money each month… the ownership of homes (and the appreciation) is hedging against inflation.
Whenever times are good the government tends to overstimulate the economy.