Never underestimate your real estate deal’s cash reserves…
Anticipate things costing more than expected.
Expect the unexpected:
- Inflation
- Rising interest rates
- Contractor delays
- Roof replacements
- Tenants nor paying their rent
- Permits held up
- Higher material costs
- Market shifts.
Most real estate deals don’t fail because you overpaid. They fail when you can’t overcome the inevitable ups and downs.
Lenders don’t fund upside down deals.
Don’t get forced to sell at a loss.
Always overestimate the cash a deal requires.
- Think you need $65,000 reserves? You may need $100,000.
- Construction budget $350,000? Plan for $400,000+.
- Projecting cash flow in nine months? Assume twelve.
Cash is your life saver to avoid selling at a loss.
✅ It solves the unexpected.
✅ You sleep at night.
✅ You buy from distressed sellers instead of becoming one yourself.
Real estate investors who grow their cash flow plan for the worst and have cash to overcome the unexpected.
Protect yourself. Don’r underestimate your deal’s cash requirements.
Ask yourself:
- Can I handle vacancies, cost overruns, and emergency repairs?
- Am I prepared for the worst, or gambling on best-case projections?
- If something goes wrong, will I have the cash to suceed or be at the mercy of lenders and buyers?
Successful investors plan ahead and have cash no matter what happens.