Reasons to Consider Investing in Real Estate During a Recession

Discover the reasons why investing in real estate during a recession could be a smart move. Discover how wholesaling can help you get started.

Build Long-Term Wealth With a Real Estate Wholesaling Franchise

It’s understandable that people should feel apprehensive about investing in real estate businesses, given that the retail side of the real estate market is currently struggling. 

With interest rates rising, the traditional process of working through a realtor or listing on the MLS ((Multiple Listing Services) is not as effective as it used to be. Many properties are staying on the market for a long time – which makes the market far more challenging.

The rental market is heating up

However, it isn’t all doom and gloom. On the rental side of things, the focus on real estate is increasing. 

From the viewpoint of real estate investing during a recession, building a portfolio (by slowly acquiring rental properties) can be an effective way to develop passive income and long-term equity. 

Indeed, real estate is an incredible generator of wealth that can be passed down through many generations. You only have to look at the wealthiest people, and you’ll discover that real estate is a big part of their portfolios.

Off-market real estate is thriving

While the retail side of the industry is currently struggling, where we are seeing growth is in off-market properties. These businesses cater to individuals who need to sell their homes quickly; for example, an inheritance property that must be divided among the heirs to the estate.

So, what we’ve got is:

  • A weak retail market ─ fewer people are buying homes as their main residence

  • A strong rental market – people who would have bought their homes are opting to rent

  • A strong off-market in real estate investing in a recession

As long as interest rates remain stable, this trend is likely to continue, even in the face of inflation.

The business opportunity to invest in real estate during recession

Okay, so investing in real estate can be a secure way to grow your wealth. But it’s not a quick fix. It’s important to keep in mind that it’s a long-term strategy. You’re not going to replace a six-figure salary with rental properties overnight. Instead, it’s a strategy that requires patience and persistence to build wealth over time.

However, there is no reason you shouldn’t combine real estate investing during recession with a real estate business on the off-market side of things. There are plenty of opportunities for those who are willing to put in the effort. The key is to find a real estate business that’s a good fit for you. Do this and you could build a seven-figure business while growing your own real estate wealth.

Wholesaling – the key that opens the door to real estate investing in a recession

Investing in real estate is seen as a capital-intensive business. But you can be involved in real estate without the pressure of high operating costs and start-up capital required. The opportunity here is wholesaling.

Wholesaling involves finding off-market properties (like that bequeathed home that needs to be sold) and matching them with investors or cash buyers. As the intermediary, you earn a finder’s fee for facilitating the transaction. And let me tell you, it’s an extremely lucrative, high-margin business.

Some people think that they can start a business with just $10,000 or $20,000, but this is unrealistic. You’re not bootstrapping a business in your garage. This might be possible if you’re starting from scratch, but doing so comes with a whole heap of added risk.

What I’m talking about is buying a franchise, and stepping into a business that is already there. 

From a business standpoint, you’re looking at a $100,000 to $150,000 investment to get a business like that off the ground and doing deals regularly and monthly. Compared to other franchise models, this is a low-investment business model. This level of investment will:

  • Get your business off the ground

  • Provide the right support and resources

  • Provide access to a tried-and-tested business model

  • Give you the opportunity to develop an annual seven-figure business

When you think of it this way, $100,000 to $150,000 is a pretty low investment, isn’t it?

If you’re interested in getting into real estate investing, and developing a business that could provide the capital to help you develop your own rental property empire, shouldn’t you be considering a real estate wholesaling franchise?

Step one – take our free, five-minute franchisee assessment to see if franchising is for you.

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