One of the things investors love the most about real estate investing is its typical stability. Real estate is considered a very safe investing option, because it remains stable, and over time, typically always grows in value.
But when there’s a real estate downturn, some investors might feel rattled. Jacques Poujade, a real estate investing expert with decades of experience in the industry, has seen his share of ups and downs when it comes to investing.
We caught up with Poujade to talk about his experience, and how to survive (and thrive) in a real estate downturn.
Jacques, tell us about the work you do now.
I’m a managing partner at LendPlus, a real estate brokerage and financing firm that is based in California. Our goal is to help borrowers finance their dream home, without typical barriers that come with lending.
My personal belief is that everyone deserves to achieve their version of the American Dream, but this system isn’t built for accessibility. You need people on your side to help you get there.
How did you get to where you are today?
In school I studied commerce, and I got my Bachelors degree from Concordia University. I then earned my Masters in Finance from McGill University. After that, I jumped into the world of finance, and my first position was a supervisory role at Coopers & Lybrand.
After that, I moved around to different roles at other firms and businesses, such as the First National Bank of Boston and Zimcor Group.
What happens in a real estate downturn?
There are a few things that can happen in a real estate downturn, or a when there’s a recession in the market. First of all, home prices tend to fall, as do mortgage rates, because less people are actually buying homes.
The rental industry can also be heavily impacted, as renters are more likely to be hurt by unemployment trends, and likely have less savings to fall back on. So, whether you’re looking to sell a property, buy a property, or you own investment properties, a downturn can definitely impact you.
What’s one thing to keep in mind to survive in a downturn?
Ride it out. The best thing you can do if you’re feeling the impact of a downturn is wait. If you sell during a downturn, you’re going to earn less than you would otherwise.
Of course, sometimes this is the only option for someone who needs the capital, and that’s okay too. The point of having investments and diverse assets is financial security.
How can someone thrive in a downturn?
If you’re able to, downturns are an excellent time to expand your portfolio, because of the low price of properties, and the low mortgage rates. Those mortgage rates alone could save you thousands and thousands of dollars in the long run. If you’re in a position to strike during the downturn, the iron is definitely hot.
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