How you can capitalize on the shifting market as we all navigate through COVID still as well as interest rate changes?
As the rental market shifts due to coronavirus and the economy, those of us in the terms business are perfectly positioned to help.
At the time of writing this, we’re in uncharted territory. With the coronavirus and uncertainty in the economy, many people in the real estate industry are getting concerned about their investments and whether they’ll be able to make it through this crisis unscathed.
But those of us in the terms business are uniquely positioned to help during times like this. We’re able to help sellers get out of sticky situations and sell their homes when they would be otherwise unable to. And on the flip side, we’re able to help buyers get into homes they would otherwise be unable to. By structuring long-term deals, we can set up both buyers and sellers to be in very comfortable positions for years to come.
And while all this happens, we’re able to continue doing deals and bringing in revenue for our businesses. We often talk about “recession-resistant” deals, and now we’re seeing that pay off.
So let’s look at what this shift means for real estate and how those of us in the terms business can continue to get deals done throughout this crisis (you’ll want to also see the special “Thriving in Chaos” Series on our podcast as well (https://www.smartrealestatecoachpodcast.com).
The rental market shift
I’ll preface this by saying I’m not an economist, but I’ve been predicting for over a year that something is going to happen with the vacation rental market. Ever since Airbnb and VRBO have gained popularity, people have been getting into vacation rentals at an alarming rate.
Everyone thinks they can buy a property, Airbnb it out, and become a successful real estate investor. And for the most part, that’s been true for the past couple of years—it’s been a booming niche within real estate.
But because Airbnb owners have been able to get a high premium for their rentals, they were also willing to pay a high premium for the properties they were buying. People have been overpaying for these properties for years, and many of them weren’t prepared for a situation like this.
After all, who could expect this? Everyone knows real estate is risky, but no one could predict a massive global pandemic that prevents people from vacationing for months or even years.
I predicted that when the market slows down, there will be a bunch of Airbnb and VRBO properties that could potentially go under foreclosure or be easily taken under contract by investors like us. And that’s what we’re starting to see.
We know for sure that there will be a significant decline in vacation rentals for the foreseeable future—and those of us in the terms business are uniquely positioned to help these Airbnb owners right now by getting them out of a situation they didn’t see coming.
So, our advice? Look to Airbnb and VRBOs in the coming months for seller leads! There will be many people wanting to get their home sold and get out of this sticky situation they’ve found themselves in. We can help.
Shifting your mindset
When you’re confronted with tough situations like we’re in now, it all comes down to mindset and how you approach it. Right now, many people are scared and nervous about the future. That’s perfectly understandable, but there are also many opportunities available right now—it’s just a matter of how you think about it.
Now is the time to shift your mindset and think positively. You’re going to need to change things up. You’ll need to look for different sources for sellers. But the simple reality is that if you’re in the terms niche, you are in a phenomenal niche for this type of market. We are perfectly positioned to flourish right now—and that’s something I couldn’t say for the last seven years.
In the coming months, we’re going to see houses foreclose. Unfortunately, people are going to continue losing their jobs. They’ll need to sell their homes quickly.
There will be a glutton of properties and people that you can help as this crisis continues to evolve. If you can just shift your thought process and your mindset, you’ll see that you are uniquely positioned to not only get through these scary times, but thrive in them.
– Chris Prefontaine, Smart Real Estate Coach Founder, CEO & Coach