the-commercial-investor.com

With all the worldwide turmoil in every single market in sight – can you believe oil is now down to $40/barrel ? – two things are occuring simultaneously.

The Flight to Quality and Stockpiling of Cash.

Both of these will be working in your favor in 2009 if you are focused on selected Multifamily Markets.

Within the Commercial Property markets, only Multifamily is expected to hold its value and cash flow. Retail, Office and Industrial properties will be hurt badly the longer the Recession continues – you can see many national Mall Owners in real trouble at the moment and that will only get worse in 2009.

Here is why 2009 will be the year of Multifamily …

It has gotten to the point of “back to basics”.

• People need a place to live
• It has become MUCH harder to get a loan to buy your own house
• Foreclosures are putting more and more people out into the renter pool
• The lending environment has slowed new multifamily starts and enabled rent stability
• Oil and energy prices have dropped to reasonable levels

Multifamily is the “Quality” of the Commercial Property world. Cash Flow is stable is selected markets and there is only one cloud on the horizon … the ability to get a Commercial Loan for a new purchase or refinance.

We know there are literally hundreds of distressed Apartment Owners out there who would have sold 12 – 18 months ago if their buyers could get a loan. There is even an uptick in foreclosed apartment complexes coming on the market at steep discounts. As soon as the lending markets loosen up, we see a lot of potential for you to get a fairly priced Multifamily Deal of your own in 2009.

And when you find it … the Money will Come.

There are trillions of investing dollars on the sidelines now … just waiting for something stable that produces cash. Heck, people are even buying T-bills that will lose money rather than investing in anything else at the moment.

So here are our recommendations as 2009 approaches.

• Look at markets where population and job growth is stable  (read … NOT Detroit) – check out Dallas, Austin, San Antonio, Salt Lake City
• Keep your lead generators going strong – be looking at properties and making offers as the market shifts
• Have a weekly conversation with your Mortgage Broker to keep an eye on the lending market and keep your proformas up to date
• Polish up your Owner Financing skills – Owner Financing becomes more likely the harder it is to get a Lender to say Yes
• Keep telling your private money network about the unique benefits of Commercial Property and the quality cash flow Multifamily can bring – when you have a deal, they will be ready to invest

You can follow any responses to this entry through the RSS 2.0 feed. You can leave a response, or trackback from your own site.