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  • Writer's pictureRick Martin

Lose the Stock Market Mindset When Investing in Apartments

When you invest in apartments, you won't feel like this lady who is worried about her stocks.

Are you suffering from stock market investing mindset syndrome( SMIMS)? If so, please pay close attention to the video below. I explain why investing in multifamily (apartments) requires an entirely different investing perspective than the stock market. If you are approaching investing in multifamily like you would the stock market, you may be missing out on some opportunities to grow your income and wealth. People have much fear right now. They may be standing on the sidelines, waiting to see how the election will pan out, if there will be a vaccine for COVID19, or if the economy will open up. That applies to the stock market, as fear and panic drive the market, as well as optimism - emotion is the key ingredient. The election and COVID are merely a speed bump for the recession-resistant asset class that is multifamily.

Multifamily is a long-term play derived from sound analysis and strategy. Part of that sound strategy is having enough capital reserves and securing the right debt structure to weather any storm. Think if most people in the US had this same mentality of building enough cash reserves to weather any storm on their own home? You would have a lot fewer foreclosures happening. People generally just save and invest (hopefully), but don't necessarily allocate a budget for operating reserves (the what-if fund). This recession-resistant characteristic of apartment investing is what I talk about in this video, and I hope it will ease some of those fears.

It's ok to poke all the holes you can in a deal (I do it every week), but don’t talk yourself out of every deal. I saw a good quote the other day: “Stop being afraid of what can go wrong, and start feeling positive about what can go right.” In the book “Rich Dad Poor Dad,” he brings up a central limiting belief that most people have, where they say to themselves, “I can’t afford this.” He challenges people to ask, “How can I afford this?” It is all a mindset. How can I make this work, and how can I be successful. Apply sound principals in investing, and you will be successful.

We can always come up with an excuse not to invest. Just do not allow the stock market investing mindset to convolute your real estate investing mindset. That type of short-term fear and emotion will cause paralysis by analysis, and you'll never get started. Start growing your real estate portfolio today. If a soundly underwritten deal comes along, there is no reason to wait. Remember, your first deal or your next deal will not be your only deal. Don’t let hesitation prevent you from starting to grow your portfolio, and thus your income streams. People need a place to live in. Ensure your investment (the apartment) provides a great living experience at a good value for your tenants, and your building will remain full. There will never be a major exodus from your 150 unit apartment. It will not tank like the stock market. Change your mindset. Rid yourself of SMIMS. With the proper deal in multifamily, there is no reason to stand on the sidelines.

If you’re interested in investing in apartment communities on your path to early retirement a great place to start is by joining the Fortress Federation Investor Club. Sign up for our quickstart guide to real estate syndications below.


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