Government Shutdown Creates Opportunity in Real Estate
Many people are fearful that the government shutdown will cripple the housing recovery. It is true that the government shutdown has many effects and negative consequences, but in reality, it is not a very big deal when it comes to the real estate market.
The Negative Effect on the Real Estate Market
Here are some of the negative impacts from the government shutdown:
- With the government shutdown, staffing has been cut drastically so government loans are taking longer.
- Some closings could fall apart since wires have taken longer than usual in many cases.
- Some conventional lenders are having issues as well because it is harder to complete necessary verifications without certain government departments.
- This of course can lead to bad loans or fraudulent loans slipping through the cracks without the essential verification.
- Government employees that are reliant on their income can become delinquent on their loans
- This can lead to more foreclosures and shortsales.
The Opportunities in the Real Estate Market (For Investors)
- It creates a window of opportunity for finding properties with bigger equity spreads
- This leads to motivated sellers since loans are currently more difficult to pull off for buyers
- Banks, investors, homeowners, and real estate investors might have deals that fall apart and are desperate for a solution. This is where a savvy investor can step in.
- Contact title companies, attorneys, and real estate agents and let them know that you can be a solution to any deals that may potentially fall apart.
- Some government employees that are living paycheck to paycheck may need to sell their house conventionally or through a shortsale
- This is where an investor can step in and create a win-win solution.
In Conclusion
The government shutdown does have a slew of negative ramifications but it also creates opportunities for the savvy investor. Real Estate is the only business in the world when everything is half priced, people run the opposite direction. If a Ferrari dealership ever had a half off sale, the cars would fly off the lot faster than the Ferrari’s 0-60. That is why most complications and adversities are welcomed with open arms by a savvy investor. More millionaires were created during the great depression than any other time in American history.
“Be fearful when others are greedy, and greedy when others are fearful”
-Warren Buffet
Privacy Policy: We hate SPAM and promise to keep your email safe.