Real Estate Market Uncertainty Amid Economic Shift
Tyler and Mike discussed the current state of the real estate market and the uncertainty caused by economic and political changes. Tyler, an active realtor, shared his experience from the last crash and his concern about the current situation. He noted an ongoing migration to Florida, but a decrease in sales due to high interest rates. Despite the demand, people are unable to afford to buy properties due to the increased rates, causing a shift in the market.
Tyler's Finance and Entrepreneurial Journey
Tyler shared his recent experiences, including launching a podcast and becoming a tour guide in Key West. He voiced worries about the current credit crisis, with credit card spending at an all-time high, and the potential issues this could bring for the country. Tyler stressed the importance of having multiple income streams and discussed his involvement in a real estate fund that buys single-family homes and converts them into assisted living facilities. He emphasized the recession-proof nature of this venture and his and Mike's cautious approach to finances. Tyler expressed gratitude for their initial decision to start the fund, as they managed to avoid an unfavorable adjustable rate mortgage on a 2.7 million dollar property. This would have led to them hitting a debt cap of nearly 9%, amounting to about 3 million dollars. Mike agreed, mentioning that many funds are currently experiencing similar issues due to rising interest rates.
Housing Crisis and Inflation Advice
Tyler warned about the market being in an affordability crisis and advised against speculative investments in real estate. He shared his personal experience of maintaining a long-standing relationship with his landlord in Key West, which allows him to maintain his housing security at a lower cost than buying a home. Despite this, he acknowledged that some people are still buying homes to move into, due to the common belief that it makes sense to buy. Tyler also pointed out the significant inflation in food prices and advised caution for those flipping houses. He concluded by emphasizing that the country is becoming a renter nation and encouraged thoughtful consideration before making a home purchase.