INVESTMENT STRATEGY
RECESSION PROOFING
12 Ways to Adapt Your Rental Property During a Recession INVESTORS WHO PLAN AHEAD AND IMPLEMENT SOME BASIC STRATEGIES DURING PERIODS OF ECONOMIC ABUNDANCE HAVE A BETTER CHANCE OF THEIR RENTAL PROPERTIES SURVIVING EVEN A PROLONGED RECESSION.
By Luke Babich
he world of real estate investing is exciting but incredibly
you have capital to spend, picking up other rental properties during a re- cession can be a good bet. But if your investment goals include long-term, steady growth, continue to focus on stabilizing your current portfolio. Here are 12 ways to adapt your rental property during a recession. 1. LOWER YOUR RATES It may be counterintuitive to collect less money during a recession, but consider this: If you are feeling the pinch of a market downturn, so are
your tenants. They may be inclined to shift to a lower-priced rental during this time to save money. Reducing your rental rates, even for an introductory term, makes your rental property more attractive to tenants. Even so, it’s still important to ensure your rental rates continue to cover expenses.
T
unpredictable. You might be riding the high of favorable returns one day only to stare down a looming recession the next. Fortunately, there are many ways to protect your investment when the financial picture is not so rosy. Sometimes the best you can hope for during a recession is to maintain your position. This means focusing on cutting costs, keeping current tenants happy, and being flexible so you can reduce vacancy rates. If
2. BE FLEXIBLE If your current tenants are struggling to make payments, consider flexible payment plans
10 | think realty magazine :: september – october 2023
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