194. When to STOP Buying - Understanding Market Decline
Self Storage Income
AJ Osborne
4.9 • 591 Ratings
🗓️ 28 March 2023
⏱️ 46 minutes
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Summary
In the midst of the recent bank collapses, economists and investors alike are shuddering at the impact of high cost of capital and the Fed's continual interest rate hikes. Banks are extremely nervous and wary of investments - all investments. INCLUDING storage.
Why is this happening, and how will it affect us? When we saw storage being oversupplied with falling demand, we knew a bubble was coming. Now it's here.
When we look at investing in self storage, we always underwrite a "worst case scenario" - what will happen to our money if rates spike or cashflow wasn't as expected? There's a time and place to be buying or be holding back. We've done this before back in 2017 - but how do you know what to do when the market shifts?
Need help funding a deal? We can help you figure out what type of loan or financing structure you need, and where you can get them. Just send us a message here:
https://www.cedarcreekwealth.com/debt
Our partners:
Live Oak Bank - liveoakbank.com/incomepodcast
Tenant Inc. - https://www.tenantinc.com/
Janus International - https://www.janusintl.com/
Grab my audiobook Growing Wealth in Self Storage for FREE: https://www.selfstorageincome.com/free-audiobook
Transcript
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| 0:00.0 | I've never had problems with banks like we have had in the last past five months. And we are at the |
| 0:07.2 | end of a ginormous bull run, one that unlike the world has ever seen. And the money creation |
| 0:14.4 | through that bull run was staggering. COVID hit and the government pumped $4 trillion to the economy. |
| 0:20.9 | And that led to a money surplus like we've never seen. |
| 0:24.3 | It's important to realize a lot of people compare this to 2008. |
| 0:27.8 | It's not. |
| 0:28.6 | We look at things in a broader context of market cycles, |
| 0:32.9 | meaning that the bank failures are not the event, right? |
| 0:38.3 | They are a symptom of something that's already going on. |
| 0:45.1 | Welcome back, everybody, to the self-storage income podcast. |
| 0:48.6 | We're so excited to dive into today's episode. |
| 0:51.7 | However, we've got some amazing sponsors that we have to shout out before we |
| 0:55.6 | get started here. And that is Live Oak Bank, Tenet Inc, and Janice International. If you guys are |
| 1:02.3 | looking to purchase your first storage facility, you just might be looking at the SBA loan |
| 1:08.3 | approach. And one of the best and most efficient places to get your SBA from is going to be |
| 1:15.0 | Live Oak Bank. These people know self-storage. They've been in the industry for a very long time. |
| 1:20.9 | They're very knowledgeable. You don't have to educate them on the underwriting, on how you're valuing, |
| 1:26.6 | self-storage, any of that. |
| 1:28.1 | These guys are incredible, and they are a phenomenal solution for you and your financing needs |
| 1:34.1 | in all things. Self-Storage. Again, Live Oak Bank. Welcome everybody to self-storage income. |
| 1:43.4 | What a week. It's been wild, man. Crazy. Yeah, last couple |
| 1:47.4 | weeks have been just off the chain a little bit. Yeah. Just when you think you, you know, |
... |
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