House Rich and Cash Poor??
Preserving equity is the name of the game in 2019.
Capital preservation is a strategy to preserve the money you have available to invest. “Capital preservation protects the inflation-adjusted purchasing power of an asset so that a given pile of money can still buy the same goods by the end of the holding period”.
The good thing of real estate is that it can protect against inflation. However, overpriced residential home markets could also potentially jeopardize your equity.
Please see attached valuable Case-Shiller table. Paying attention to these numbers will be critical during 2019 to assure that you take sound decisions to preserve your equity.
Making sense of these numbers will be as critical. The only way to make sense of them is to consider fundamental submarket indicators such as:
- Job Growth
- Population Growth
- Unemployment Rates
- Interest Rates
- Local Vacancy vs Rent growth
- Absorption rates
- Home supply (check demand and supply house inventory),
- Among others.
Also, the fact that Las Vegas appreciated so fast (one of the most overpriced markets in 2018) doesn’t mean it is a good thing into 2019. It is actually the opposite. So paying attention to fundamentals combined with house appreciation is important.
Looking forward to selling your very expensive properties and re-invest in other cities with a better cash flow for your retirement years? Need guidance on 1031 exchange impact? Do you have properties in San Diego, Seattle or Vegas that you need to sell and re-invest? (Look at the fundamental indicators 🧐)
Let’s talk! I know how important retirement is for all of us. And a good plan is to be ahead of the game and preserve equity.
Have a great Day! 😊👍🎶🥳💪❤️