House flipping, rental property investing, wholesaling, and every other type of real estate investing has had an incredibly profitable run-up over the past two years. Days on market shrunk as buyer demand soared and supply dried up. Flippers, rental property investors, and everyone in between saw profit margins they couldn’t have imagined before. But, now that may all change.

Rising interest rates have stopped many would-be homebuyers from making offers, forcing them back into renting instead of sending in over-asking bids. Now, home equity and flipping profits are starting to see a lag, as mortgage applications significantly slow down, showings become far less crowded, and price cuts become the new norm. Are we at the beginning of a real estate recession, and if so, how can we best prepare to still profit during the downturn?

James Dainard, master flipper, investor, and “On The Market” guest, has had to readjust almost every way he analyzes real estate deals. He’s managed to cash in some serious flipping profits over the past two years but understands that this year will be different. He shares exactly how smaller landlords, real estate investors, flippers, and wholesalers can “pad their profits” so they don’t get burnt on their next real estate deal.

In This Episode We Cover

Why price drops have doubled even though many homes are selling above asking price

Seller FOMO (fear of missing out) and why now may be a great time to find phenomenal deals

Why cash flow has reemerged as the most important investing metric for rental property owners

The 1% rule and why using it on every property could cost you money

Readjusting your expectations as a flipper and how to “pad your profits” the right way

Whether or not you should “trade up” your rental properties to protect your portfolio

And So Much More!

Links from the Show

BiggerPockets Forums

BiggerPockets Agent

Join BiggerPockets for FREE

On The Market

Join the Future of Real Estate Investing with Fundrise

Connect with Other Investors in the “On The Market” Forums

Dave’s BiggerPockets Profile

Dave’s Instagram

Mortgage Applications Decrease in Latest MBA Weekly Survey

Nearly 1 in 5 Sellers is Dropping Their Price

Connect with James:

ProjectRE with James Dainard

Check the full show notes here: https://www.biggerpockets.com/blog/on-the-market-13

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13: Why Investors MUST Change The Way They Buy Real Estate in 2022 w/James Dainard 01:01:33 Share

On The Market

Shownotes Transcript

13: Why Investors MUST Change The Way They Buy Real Estate in 2022 w/James Dainard