I was perusing around the online forums when I came across a thread that struck a chord with me — As has been the topic of much discussion over these last few blog posts, it was about Fear and Greed, and how we as investors can best prepare to navigate through the inevitable market cycles.
The original poster is well known on these forums and a really smart guy who I respect a lot, and someone who I’ve had the pleasure of meeting in person; it’s good to know that at this point in the bull run his focus has also turned to preparing to play strong defense!
Here’s a link to the thread with lots of insightful comments made by seasoned real estate pros who have weathered the worst of economic storms:
This line in particular resonates 100% with me, and aligns with my thoughts on completing two separate cash out refis earlier this year to hoard more cash:
All I hear is “pay off debt to lower risk” “pay off debt, “pay off debt.” Because my properties cash flow well, I’d rather have the low, fixed, 30yr-am payments and cash in hand for the downturn, than a bit less leverage and far less cash on hand for future risk or deals.. The amount of cash I would need to significantly reduce my debt is very large, compared to the safety and buying power of that cash if/when the sh*t hits the fan again..
Great minds think alike? Or do Bay Area folks all just drink the same kool aid? 😉