Are Property Prices Going To Crash? #Dailydose
At this moment as you read this, many economists all over the world are in great debate on weather Australian property prices are going to crash....
Recently US Economist 'Harry Dent' predicted that property prices in Australia were going to collapse by 50% in the coming "Far overdue" quoted global financial crisis which he predicts will make the GCF & even the great depression look like a walk in the park...
With all this playing out it is no wonder why the average person stays stagnant on the sidelines not knowing what to do with property right now weather that be buying more property at these highs, selling their current assets or sit on the sidelines in cash and wait for the coming property collapse in order to buy up cheap assets...
On this week's #Dailydose i am here to help you set the record straight and gain clarity on how you can not only protect yourself if a crash was to take place, but to actually profit like the ultra wealthy real estate investors do, gain direct clarity and leave fear & uncertainty behind...
So....
How to protect yourself if a property crash does take place:
You must own assets that produce positive cash-flow every single week, forget what your accountant told you about negative gearing.
Look i get it it may seem like a great idea but the fact of the matter is the people who got whipped out in 2008-2009 GFC was because their properties were negatively geared, property prices dropped, rents dropped in proportion to property prices and the vendors could not make the repayments so the banks call in their loans and they foreclosed on their properties....
Which ultimately sent alot of people bankrupt!
But don't take my word for it...
let's take a look at what position you would be in between the last GFC & now if you could of weathered the storm because of positive cashflow?
As you can see if you were able to weather the storm of the GFC in 2008-2010 your property value would be in a sustainability much better place right now & all your sleepless nights would now be a dream.
But...
Unless your property produces positive cashflow it's very hard to hold onto a asset while losing money every week in repayments, all while you are seeing your property value slide out from underneath you with the media talking about property prices dying forever...
I get it...
On the flip side if your property produces you positive cashflow you can hold on forever until the market finally corrects and comes back, because it's simply not costing you anything each week.
This is my number one tip on how to protect yourself if a property crash is to take place in the future...
NOW....
You are all probably thinking
"Nathan okay we get it- Positive cashflow is the game, but how do we profit from a market downturn?"
It's quite simple really & common sense when you think about it...
Be liquid & ready to pounce if a opportunity presents itself...
I can't tell you how many clients of mine made a fortune through arguably one of the worst times in history 2008-2009 the GFC period
Why & How?
They were liquid and were able to pick up assets for cents on the dollar from vendors that banks were calling in their loans or foreclosing on...
So how do you get liquid? Here are my 3 tips...
1) Sell down any old none performing properties, the ones that are causing you problems every week & are not producing cash-flow
2) Open up lines of credit & get pre approvals in place with the banks
3) Get rid of any bad performing debt that doesn't produce you cashflow each week
Now i must set the record straight i do not believe we are going to see a market collapse like all these so called economists that have been predicting doom & gloom for the better part 10 years...
Buyer activity is strong & growing each week at our open houses, developers & development projects are increasing week on week & sellers are few in between which demonstrates it's differently a seller's market right now...
But if we do experience a market crash i want to be prepare & i want all of you to be prepared also...
These are my biggest tips on how to prepare & protect yourself in any market condition
Nathan
#Dailydose #Realestate #Realestatewriter #Realestateentrepreneuer