Investors Need to Rethink the Real Estate Market

Andy Snyder|January 30, 2023

We held our monthly live video call with VIP subscribers last week. Once a month, we get on the virtual horn and chat with Alpha Money Flow and Venture Fortunes subscribers.

I go through the latest charts and data points, setting up trading ideas and expectations for the next few weeks. And then I answer some questions from subscribers.

Last week, somebody asked about real estate.

Oh boy… if I had known then what I know now.

The question was simple. Is now a good time to buy real estate?

My answer was almost as simple. It’s always a good time to buy real estate… if you know what you’re doing.

Buying properties is a hyperlocal idea. We used the example of our most recent purchase – a small, 10-acre farmstead with an old house on the property. It was an off-market deal that we pursued and pushed through.

Realtors would have told us that prices in the area were frothy and that investors should wait. But we wouldn’t have listened… We got a great deal.

Buying real estate is a very personal investment. It depends on your situation, the exact deal and what your intentions for the property are. What’s good for you might not be good for someone else.

That’s the answer we gave last week, anyway.

But times have changed.

Now we’re rethinking the whole darned thing.

There Goes the Market

Direct from the White House…

Ahhhhh, geez…

There goes the market. Hardworking, middle-class real estate investors are about to go the way of the dairy farmer… Amtrak… the post office… good-paying factory jobs… higher education… coal miners… teachers… and every other thing the government puts its fat thumb on.

With Washington looking to buy votes with cheap rent, the real estate market is certain to suffer.

We dug through the president’s plan a bit.

Fortunately, it’s mostly hot air.

It calls for yearslong studies and action plans. It asks for federal agencies to stiffen their policies. And it calls for state and local governments to cooperate.

But you can bet this headline-busting plan is just the opening salvo in a fight against the rental market as we know it. After all, it’s not the president who can make big changes in the space… it’s our representatives in Congress.

And those folks are getting antsy.

As we write, there’s a push from the left to create nationwide price controls, to make it even harder to evict folks who aren’t paying their rent and to force landlords to explain why rents have increased by more than 20% over the last three years.

Fortunately, that last answer is simple. Landlords can simply cut and paste the following line…

Rents jumped because the government told renters they didn’t have to pay their bills during the pandemic. Landlords are only getting back what they lost.

Let’s not forget that it’s not some faceless corporation that owns most of the nation’s rental properties. It’s the everyday investor who’s just looking for a way to get by. Some 70% of rental properties are owned by individuals – many of whom rely on those rent payments as their sole source of income.

Cut their payouts… and you’re taking food off their tables.

This idea is a disaster in the making. It will take more folks (renters and landlords alike) out of the middle class and push them right into the oh-so-loving arms of the government.

Price controls of any kind have always been a disaster.

This is little more than a scheme to use more taxpayer dollars to buy votes.

America is better (and smarter) than this.