SOFUN MEDIA's video: 6 Things You Need to Do as real estate investor to Prepare for a Potential Recession

Lin Li DRE # 02001468 & Patrick Ahern DRE of Berkshire Hathaway Realtor ® Buy Low LIVE Hig: 300 Via Del Norte, La Jolla, CA， 📞 Contact us if you have any questions: 619-913-7438 A recession is a significant decline in economic activity that lasts for months or even years. Definition of a recession is when nation’s economy experiences 2 consecutive quarters of negative gross domestic product (GDP) They check the levels unemployment, falling retail sales, measures of income and manufacturing, and more. Basically, most agree we are in a recession now. We are also experiencing a sudden economic shock: A surprise problem that creates serious financial damage. In the 1970s, OPEC cut off the supply of oil to the U.S. without warning, causing a recession, not to mention endless lines at gas stations. The coronavirus outbreak, which shut down economies worldwide, is a more recent example of a sudden economic shock. How to Prepare for a Potential Recession Step 1: Collect all the relevant information you can. • We don’t know what exactly will happen – • Retail, restaurants, and office are already changing. • Retail is very much online • Restaurants have restricted occupancy, and many are closing • Office may become more virtual using Zoom and other applications, and other than large corporations, may be moving closer to residential areas • Keep your eye on trends that are coming. Step 2: Come up with a plan. • One may consider a Strategic plan • Create a Vision – where you want to go. • Gather and Analyze Information • Define Strategy. ... Implement . . . problem is, as we have seen, things change and your Vision may too. • Strategic Navigation - SPPATA – Scan, Pick, Plan, Act, Track, Adjust • We will talk about that in another talk – basically, come up with a plan. Collect information, come up with a plan, now Step 3: Strengthen your foundation get your reserves in order. • Whatever reserves you have in the bank or investments, o these need to be doubled or tripled when preparing for a recession. • Because: • Income from your tenants may be changing due to job loss, or shutting down companies. • Building up your reserves will require discipline but it will be worth it – • Every time you get a check, put aside 20%-30% or more in a separate account from your operating income – this is true all the time. • Consider taking full advantage of the stimulus package. Do your research and find out what assistance is available to you. Step 4: Your setting aside reserves . . . now cut your unnecessary expenses. • Go through all you expenses with a fine tooth comb. • Check your credit card statement to see if there are any subscriptions you are not using, or anything not making you happy, close them out. • Pay off credit cards to avoid paying excessive interest rates to the bank, and improves credit score. Step 5: Stay positive. • We’ve all heard the saying, “Hope for the best, but prepare for the worst.” • This is truly the best thing you can do during uncertain times. Realizing that there are things within your control and things outside of your control can be really helpful. • Do what you can, and don’t stress about what you have no control over. • The economy is cyclical; downturns are normal and to be expected. You can’t change that, but you can decide how you will handle it and what you learn from it. Step 6: Take care of yourself. • When we are threatened: • Fight or Flight or Freeze • In Fight or flight your heartbeat quickened, you begin breathing faster, and your entire body becomes tense and ready to take action. • with acute stress, the body's sympathetic nervous system is activated due to the sudden release of hormones. • Has negative Mental and Physical impacts • According to the National Science Foundation, an average person has about 12,000 to 60,000 thoughts per day. Of those, 80% are negative and 95% are repetitive thoughts. If we repeat those negative thoughts, we think negative way more than we think positive thoughts. And this has an impact on your health and mental state. • There is evidence that starting the day with positive thoughts will help change your thoughts and mind. • Take a walk – try finding Meditation music on Pandora or Spotify, and play that, you will be amazed how aware you become of your surroundings, and how relaxes you feel. • Come up with a plan, and stick to it. Create some routine and normalcy in your life, and cut yourself some slack. Collect all the relevant information you can / Come up with a plan / Get your reserves in order. Cut expenses / Stay positive / Take care - We are in a recession - Be Prepared