It’s a question everyone in the real estate world wants to know the answer to—what’s going to happen to the market?
As investors, it’s important for us to know what to expect. And unfortunately, it’s not always easy to predict what will happen next. But I’ve asked some of the best investors I know to give me their thoughts on where the market is headed this year… and they have some great insights to share!
So, here you go… 17 answers to the question “What do you anticipate happening with the real estate market in 2016, and how will this affect your investing strategy this year?”
Real estate is local, and there is opportunity in every market. That being said, I anticipate the market will begin to flatten in 2016 and interest rates will begin to rise a least somewhat. At this time, I don’t expect the market to affect my investing strategy. As long as you buy right (i.e., at a significant discount to market value), there is still room for profit even if the market slows down. Since I market directly to sellers, I don’t expect any significant change in my marketing strategy, as motivated sellers exist in both up and down markets.
Andrew Herrig lives in Dallas, TX along with his wife and daughter. He has been investing in the DFW market since 2013 when he bought his first rental property. Andrew is primarily focused on his wholesaling business, but also flips and has a growing portfolio of rental properties. He has done 11 deals in the past two years, and is looking forward to scaling his business in 2016 and beyond! Check out his website at http://www.andrewbuyshousesdfw.com. Andrew is a member of the House Flipping Formula coaching program.
I anticipate that the market will always be changing, but that there will always be a market. I’ve been investing in real estate for 13 years now and I’ve seen a few different types of markets. I’ve made money through all of them. Make sure you are always aware of what is going on in your market and SHIFT with it. Real estate has always been an inefficient market, and because of that, there will always be opportunity for investors who know how to create deals. The variable here is YOU; how good are you at your craft?
Andy McFarland is a self-made real estate entrepreneur who started with nothing and currently makes seven figures a year in his real estate business.
After getting fired from his last W-2 job in 2004, Andy went into real estate full time and has never looked back. Andy currently focuses on wholesaling properties in three different states; Utah, New Mexico, and Indiana. In 2015 alone, Andy did over 150 wholesale deals. You can follow Andy on his real estate journey by going to his website: www.iloverealestatestories.com or on his YouTube channel by searching for I Love Real Estate Stories. Andy is a coach along with Justin Williams in the House Flipping Formula and 7 Figure Flipping programs.
I anticipate 2016 to bring a flat market with no significant appreciation or depreciation in Southern California. We will continue to purchase homes to flip, but will not be purchasing any additional rentals. With a flat market flips should still work fine because you’re in and out hopefully in four to six months. We are watching the market closely and will consider its impact on our flipping business as we continue to look for acquisitions.
Holly McKhann is a full-time real estate investor and works with her husband Scott, having done over 200 fix and flips together in Southern California over the past seven years. Holly began her career as a CPA, working for Ernst & Young. She also earned an MBA in finance. Scott is a registered civil engineer with a decade of experience at public home builders. Their blend of expertise and experience has attracted multiple investors, allowing them to expand their business. You can check out everything they’re up to at HouseFlipMasters.com!
Holly and Scott love working from home and enjoying their freedom as entrepreneurs. They have been married 24 years and have 4 children ages 13, 15, 18 and 21. They live in Dana Point, CA and flip homes all throughout Southern California. Holly is a member of the House Flipping Formula coaching program.
Feds just raised rates for the first time in many years. The Federal Government is the biggest borrower, and they will see the biggest effect. Mortgage rates will likely rise too. We are in a cash business where most of the buyers have liquid cash to invest. I don’t foresee a wholesale business having many challenges UNLESS they pass something from Washington that says if you do any kind of real estate transactions you must be licensed. That might cause some slow down, but we have two people on our team that are licensed now, so that shouldn’t be that big of a deal. I think if you are in the fix-and-flip business, you are going to see more of a change since you are dealing with contractors and then retail buyers.
Cory Boatright is a social connector who believes in servant leadership. He’s a serial entrepreneur and founder of Real Estate Investing Profits and Phenomenal Results Coaching. Between himself, his teams, and his students all over the world, he’s bought and sold over 75 million dollars in real estate by completing over 1000 real estate transactions.
Today he coaches high achieving entrepreneurs and their teams to getting phenomenal results in their businesses. Fast Company Magazine, The Wall Street Journal, and even Harvard University are among a few leading organizations that view him as a thought leader and visionary. Cory’s biggest success was beating Thyroid Cancer. Today he’s using the life lessons in what he learned to inspire, impact and serve others at The GrafefulProject.
I suspect the market will cool mildly, which is great. I believe I can make money so long as it’s an orderly market, either ascending or descending. Our strategy is to monitor Days On Market, Price, and Total Sales. If these creep, we will increase margins and be cautious about holding inventory.
William has been investing in RE since 2003 and has performed 11 rehabs, 5 wholesales, and 2 buy and hold deals. He lives and invests on the Central Coast of California, in San Luis Obispo County and the surrounding areas, where home prices range between $400k to 600k or more. Properties vary widely from upscale coastal areas, horse county, wine country and rural. His primary focus is rehabs. Check out his site, http://www.williambuyshouses.com/. William is a member of the House Flipping Formula coaching program.
I think everything has changed; especially marketing. Direct mail will remain a very viable marketing strategy. However, real estate investors much concentrate more on their websites and inbound marketing strategies to survive.
Sharon Vornholt is the owner of Innovative Property Solutions in Louisville, KY. She has been investing in real estate since 1998 and has been a full time wholesaler since 2008.
Sharon is the creator of the Louisville Gals Real Estate Louisville Gals Real Estate Blog and the popular podcast “Let’s Talk Real Estate Investing”. She is also mentor and a coach who loves teaching others how to succeed in this business. You can find out more about her at LouisvilleGalsRealEstateBlog.com.
Doug and Andrea Van Soest
We don’t anticipate any huge declines in 2016; however we still plan to do more wholesaling and fewer rehabs.
Doug is a former appraiser and his wife Andrea is an interior designer and licensed realtor. They began flipping houses in the Inland Empire area of Southern California in late 2008. They quickly transitioned to flipping houses full-time and have been fix-n-flipping, wholesaling, and buying rentals all over Southern California ever since. They are currently doing about 5-6 deals per month and just started a podcast called Spouses Flipping Houses.
It’s tough to say. I know the Fed just raised the interest rates a quarter of a percent, but I don’t think that’s going to have huge impact on our business. We’re going to see price increases, at least in our market; prices are continuing to go up in south Florida, so for the rehab side, it’s great. For the wholesale side, there’s still a ton of foreclosures and short sales here, and those aren’t going anywhere. So I don’t see the market being too different this year from last year.
Gabriel lives in Miramar, FL, and invests in Miami Dade, Broward, and West Palm Beach counties. He’s been investing since 2012, and is currently focused on rehabs and wholesales. He finished off 2015 with about 50 completed transactions and is aiming to double that in 2016. Check out Gabriel’s website, FloridaCashHomeBuyers.com, or connect with him directly on Facebook!
Rates going up. Maybe not drastically, but this will slow our sales down on the retail end and lower prices. This means we’ll most likely be able to get even better deals for the buy and hold program, but the cost of private money might increase as well. We shall see…
Dave Payerchin is co-founding partner of Columbus Turnkey Houses and a Licensed Realtor with Shoreway Realty group in Ohio. His specialties are networking, raising capital, system automation, and developing/maintaining relationships. Dave has formal training in several facets of real estate investing and has been successfully closing real estate transactions in several states (including Ohio) since 2005. Prior to joining Columbus Turn Key Houses Dave worked as a real estate trainer and professional speaker. His hobbies include rooting for the Cleveland Browns & Cavs, rooting for The Ohio State Buckeyes, spending time with his parents and his 7 nieces and nephews.
Currently we are only in two markets, Houston, TX and Albuquerque, NM. Houston, TX for the last four years was on a high growth and appreciation trend due to the highest job growth in the country and high oil prices. Now that oil prices have come down we have seen the market start to cool. Prices are holding but the market is slowing down. Since our company and our clients buy for long term wealth building we don’t see much of a change in our business. The only benefit is we will be able to buy homes at better price points since the market won’t be as hot as before. We also anticipate interest rates rising. With the cooling of the RE market and the rising interest rates we anticipate the rental market to get stronger and more renters in the market. We see our Management companies increasing profits and growing by 25% in 2016.
Shawn Wolfswinkel has 15 years of experience in Real Estate. He purchased his first investment property at the age of 19. Since then he has bought and sold over 700 properties. He has continued his training every year, attending numerous seminars and educational functions to strengthen his expertise in Real Estate. He has been educated on wholesaling property, pre-foreclosures, rehabilitation and contracting, leasing and management, owner financing, Commercial real estate, financing, contracts, and state laws. He currently owns 28 personal rental properties, buys and sells 100 homes a year through his Turnkey Company, TexasTurnkeyProperties.com, and manages 700 properties through his Management companies, Real Property Management Preferred located in Houston, TX and Real Property Management Albuquerque located in Albuquerque, NM.
There was so much growth in the Atlanta market from 2014 to 2015 that I believe sellers’ confidence will rise, making it slightly more difficult to continue to acquire properties at the record lows that we have been experiencing. But new times call for new measures, so I am looking closer to the markets right under our luxury market here in Atlanta. There have been a few more changes to the lending parameters that have made it a little more difficult for first time home buyers.
Delon Hall is a fix-and-flipper in Atlanta, who in 2016 will attempt to take on Chicago and Orlando as well. A wholesaler since 2008, Delon is also a buy and hold investor with 3 properties in NW Indiana, 2 in Chicago, and a package deal in the works in SW Atlanta. He is also a licensed agent with a team of 2 staff and 3 agents. Delon is a member of the House Flipping Formula coaching program.
I think 2016 will be the same as 2015… bouncing along, but I am being very cautious! I do some pretty big rehabs, but I can still get in and out of them pretty quickly. I’m not doing any additions or new builds. My average flip time is 4.5 months (from escrow to escrow); anything longer than that is too risky.
Kristi Cirtwill is an active real estate investor who has purchased over 125 properties in the southern California area to flip and hold since 2008. She lives in Cerritos and hosts food nights and plays music in her spare time. To connect with Kristi and check out some of the incredible rehabs she’s done, head over to Cirtwill Investments Inc! Kristi is a member of the House Flipping Formula coaching program.
Interest rates will rise slightly. This could affect some of the purchasing power in the real estate market and slow it down some. We will be focusing on inventory for first-time homebuyers so they can move from rent prices to home mortgages with as little monthly expense impact as possible while giving them more value for their housing dollars.
Randy Lawrence is an indomitable entrepreneur with over 24 years of experience and four successful real estate investment companies. He is also a pastor and founder of multiple life changing ministries and in the last 15 years has impacted over 40,000 people. He has been featured in the St. Petersburg Times, Tampa Tribune, and seen on CBN, NBC and CTN as the “Transformation Expert” focused on transforming lives. Randy is also the host of the Real Estate Preacher Podcast.
I expect a lot more of the same as 2015. Being an election year, I don’t think too much will change in regards to SoCal real estate until 2017 when we may see an increase in rates. With this increase in rates, we may see a rise in home prices as well. This won’t effect my strategy since I will continue to adapt and change to what is most effective to acquire homes. I feel I have a good measurement of the pulse in the market and will change accordingly.
Alex Bejenaru is a lifelong Southern California resident living in Yorba Linda, CA, with his wife and 2 kids. He started his flipping business in February 2014 as Premier Pacific Properties, LLC (webuysocalhomes.com), and in 2015, he quit his full time gig as a residential loan officer to be a flipper full time. In 2014 he bought 2 flips and is finishing up 2015 with an additional 9 flips completed and 2 properties wholesaled.
Our market is growing. Prices will increase slightly and so will the rents. Won’t affect our business model much; we may have more competition, but it’s not an issue.
RJ is an experienced real estate investor who has closed over 150 real estate transactions and co-founder of Columbus Turnkey Houses. He is an expert in the Columbus market. He has had formal training in deal structuring, creative financing, and other residential real estate areas. He received his BA in Marketing Management from Youngstown State University in 2005. RJ attended Youngstown State University on a full ride tennis scholarship where he played #1 Singles and Doubles all 4 years. His hobbies include tennis, photography, Cross-fit workouts, and guitar.
I think the market will level out and slow down in many areas, and currently depressed areas will continue to gain and catch up on the other ones.
Jack Bosch is one of the Country’s foremost experts in Tax Delinquent Property Investing and more recently an educator in Real Estate Investing. Since 2002, Jack has been buying and selling mainly unimproved land and has completed more than 3,203 land deals. Learn more at JackBosch.com.
I’m keeping a close eye on things. I’ve been burned in the past. If things change, I want to be able to keep houses as rentals if necessary.
Tom has been investing in real estate for 13 years. A former Catholic priest, he is married with 2 teenage sons and flips houses in the Chicagoland area. Tom is a member of the House Flipping Formula coaching program.