Things were going great. You were in a groove, crushing goals, buying properties, or making progress on your first deal. Borrowing money was easy and people were turning great profits.
Then the unthinkable happened. A black swan event. Coronavirus came and wrecked your plans!
The investing world changed overnight. Hard money lending dried up almost completely. Governors told their residents they didn’t have to pay rent. Forbearance became the buzzword. The government offered low interest and forgivable loans to landlords. You thought “Wow, this is bad. I better pump the brakes.”
But I have one goal here: to steer you away from this strategy. Or complete lack of a strategy. I want to encourage you to not lose your momentum.
Don’t sideline yourself!
Market cycles are normal, and we will come out of this. Realize that and don’t let it mess with your confidence, or derail your plans. Remain cautiously optimistic and posture yourself to take advantage of the opportunities that will come from this event and subsequent market downturn.
Those that are fearful will let go of their assets, probably for a lot less than they are worth, providing an incredible opportunity for you!
And as other investors take a step back, there will be further opportunities for you to make offers unopposed and without competition.
And I have every reason to step back!
Back in September, I bought a very high risk property, planned to flip and sell it quickly in a very affluent area of Nashville. I was freaking out, but stoked about the potential. I could make $100,000 on this property and it would give me the reserves I needed to take my business to the next level.
Things went downhill from there. My contractors got in way over their heads, lied repeatedly, did crappy work and hid a lot of issues, then walked off the job site. By the time I corrected (most of) the damage they created, my hard money loan term was running out and I went to refinance since I didn’t yet have a buyer. While waiting for the appraiser to get out to the property, coronavirus stopped the market in it’s tracks and the appraised value dropped $92,000.
I finally got a decent offer on the property and ended up losing $45,000 on the property. $45,000 is a lot of money for me…a solopreneur who is experiencing an economic downturn for the first time as an investor. A year ago, I was a stay-at-home mom, dabbling in real estate as not much more than a hobby.
This experience made me want to sell every property in my portfolio, close down my coaching business, and move on to another industry. But then I realized, this experience is not going to break me, it’s not going to define me, but it sure is going to make me stronger, better, wiser.
It is an expensive lesson to learn, but the most important lesson I learned is that I will overcome that loss. And bounce back. What other choice do I have?
Don’t lose your momentum!
As a parting thought, I leave you with a challenge:
Stop thinking about surviving this, and instead think about thriving!
I know I don’t want to come out of this three months, or five years, from now and think “I’m glad that’s over!” I don’t have time for that! My goals can’t wait five years! I want to look back and say “Wow! I am really proud of myself and the way I overcame those hard times.” And know that I can and will get through whatever gets thrown my way!
I am choosing to thrive! What about you?