Distressed properties are the next bubble to burst. You read it here first.
Like other get-rich-quick booms of the past (see The Gold Rush of 1848, the Internet Boom & Bust of 1990's, and most recently the Mortgage Boom & Bust) that everyone flocks to, this too will go bust. The people who make the money are not the people hoping for gold, it's the guy repairing the wagon wheel, the web hosting company, and the closing attorneys (well, at least for a while there). Don't get fooled into thinking that you are going to make a ton of money just because you are buying distressed. What you're really doing is buying stress.
Why? Because these properties are, for the most point, distressed for a reason. Distress is a bad thing. Maybe it's a bad location, a bad condition, a bad loan, a bad tenant, bad cash flow, or just a plain bad deal. Just because something is priced low does not mean it is a good deal. Of course, there are a few low-priced deals out there that do make sense. But, heading out West, so to speak, without the proper guide will just get you shot in the back with an arrow.
At Gene Kansas Commercial, we are going contrarian to the general public and the "gold diggers" and instead are focused on good, solid assets. We work on good properties, with good management, and in good locations. On top of them being better long-term investments, they're just more fun to be around. Of course, there are also fewer people trying to find and acquire good properties too...ever heard of supply & demand? Just sayin'.
