A week ago I noted that nearly half of the newspaper and media stories were about the COVID-19 virus (and I’m going to try and stop using Corona virus out of respect for Corona Beer and Corona Cigars, neither of which had anything to do with this). This morning as I read the newspaper, 9 out of 10 stories were either about the pandemic or the effects of the pandemic. US cases as of today, March 19 exceed 10,000 and we have had 161 deaths. Not to be insensitive but to provide a little perspective, So far in 2020, the flu has hospitalized more than 250,000 and more than 14,000 have died.
It’s staggering to see the entire American economy come to a grinding halt. Just today, San Francisco is shutting down the entire city for four weeks. Churches, restaurants, bars, and gyms across the country are not meeting. People are either working from home or not working. And the financial effects are being felt from Wall Street to Main Street. Those with good jobs are suddenly without work and are facing an imminent crisis when their cash runs out.
How will they pay mortgage or rent? How will they buy food? How will they live? The government is stepping in. Congress has already passed two stimulus measures and they are working on more, more than $1 trillion in stimulus spending is planned and the White House has said they will do more if needed. FHA has called a moratorium on foreclosures and evictions from all FHA guaranteed loans for the duration of the crisis, At least three cities have already banned evictions and others are considering it. I’m immediately wondering two things.
- How far up the food chain will the forgiveness for non-payment go? We can’t evict our tenants for non-payment, but without their rent, we may not be able to pay our mortgages. For those with free and clear rentals, that money may be our primary income. What will we do?
- All of the social distancing is designed to protect the contagion from spreading. But this cannot last forever. When it DOES end, if only one person in the world is still contagious, what is to keep this from starting all over again?
I believe the health experts are working on answers to the second question. Our purpose over the next little while is to try and address more of the economic questions, particularly with regard to real estate investors.
My team and I will give 30 minutes of our time at no cost or obligation to help you take the next steps - or your first steps in your RE business. Go to bit.ly/talktoroger
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The Economy as a whole
The Short-Term economic outlook.
The Long-Term impact
The Recovery time and process (once we hear the “all clear).
Question: Do you expect a quick snap-back due to growing pent up demand? (A V-shaped recovery?)
The Federal Government Economic Intervention
Stimulus package passed Wednesday afternoon: 2 weeks paid leave for employees.
$1 Trillion stimulus package on the way.
FHA backed loans will not foreclose for at least 60 days.
Other initiatives?
Local
California stops evictions. Boston and New York considering.
Question: Should these same municipalities spare the landlords from having to maintain properties and pay mortgages during this time? How far up the ladder should relief go?
Asset Classes for Discussion. How do you see each of these areas being impacted? And more importantly, what can people do who make their livelihoods here?
Single Family Fix and Flip
Single Family Rentals
Multi-Family Rentals
Short-Term Rentals
Other Real Estate Investing Strategies
General Questions:
What should each listener do right now? Your top 2 things
What opportunities are out there right now?
What opportunities will be there when recovery is underway?
When the “all clear” is given, what is the optimal position for us to be in?
How to contact us
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News:
- 250,000 hospitalizations, 14,000+ deaths. The FLU, not Covid-19, 105 children have died. 6.8% of those contracting the flu will die. https://www.usnews.com/news/health-news/articles/2020-02-21/flu-season-thats-sickened-26-million-may-be-at-its-peak
- Mortality rate from Covid-19, 4.12% https://www.worldometers.info/coronavirus/
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Topic: RE Investing During a Pandemic
Your Questions: Send emails to
[email protected] - Many “If I can’t collect my rent, what am I supposed to tell my mortgage company?”
- Carter, Tampa, FL “I have several tenants who are already not paying, although I believe it has nothing to do with the coronavirus. As I write this only about 20 people in our metro area have it. How do I proceed?”
- Suzanne, Villages of Ocala, FL “We live in a retirement community and along with our neighbors we are truly frightened. No one is going out. We are having food and supplies delivered and sanitizing the bags they come in before touching them. I can’t help but wonder how America is going to cope. I love your show and enjoy your enthusiasm. I’m just wondering what your outlook is right now.”
Motivational Thoughts for the day “It’s going to be OK in the end. If it’s not OK, it’s not the end.” -Roger Blankenship
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