Weren’t In The Market Pre-2008? Here’s What You Must Know

Aug 5, 2022

If you’ve only been investing since 2008, these are seven things you MUST know.

There only seems like a handful of investors and CEOs who have been in this space since before the 2008 Great Recession. 

Millions didn’t make it through. If you, and most of your advisors haven’t been through it, there’s a lot you may not appreciate that can have devastating, lifelong impacts. 

This isn’t just about not achieving great performance on your investments. Everything can be on the line. Your entire business, personal portfolio, your car, your home, your relationships, and mental and physical health. 

Here’s what you need to know to not just survive what’s happening now, but to win, and win big. 

  1. The Market Can Go Down A Lot

All real estate is local. So, exactly how deep property price cuts are on assets you own will vary. Yet, back in 2008 we were buying homes and mortgage loan notes for 40 cents on the dollar, or even less. 

This may not mean the fundamental value changes, but panic and other dynamics lead to temporary overcorrections, and properties can end up trading for a fraction of their previous highs for a while. Don’t be fooled into thinking you have the luxury of time if you need to sell something.

  1. The Market Can Go Down Fast

These changes can come a lot faster than you think. Consider that in just the first few months of 2022, some housing markets saw price cuts of almost 20%. 

  1. Don’t Count On The Banks

You cannot count on the bank being there to help or finance you in a crunch. They are dealing with their own crises, and are worried about their own risk and profits. 

In the wake of 2008 we learned to step up, and ‘become the bank’ to serve those who were victims of these changes.

The time to finance, refinance, or restructure debt is well before the crisis strikes.

  1. Most People & Businesses Will Leave The Industry 

How many people do you know that have been investing in these asset classes from the early 2000s, through to today?

That’s probably about how many will survive the next rotation. 

Only the most experienced, who have planned ahead and prepared will make it. The chances are that many individual investors, tech startups, and even billion dollar funds led by newbies will go bankrupt in the next few years. Consider that even Google, one of the largest and best funded organizations in the world recently joined the masses of others in slowing hiring, or freezing it. 

Make sure your money is with those that know how to survive and thrive through it.

  1. The Market Will Bounce Back

Just as many cannot see the correction coming when everything seems bullish, just as few may be able to see that a turn around is coming when we are in the pit of the crunch. 

You may hear that “it’s different this time.” It is never that different. The market can be manipulated to extend bull and bear runs, but the forces of nature will always prevail.

Eventually, prices will even surpass their recent highs, making 2021 real estate deals look cheap in comparison. 

  1. You’ll Regret Selling

Talk to anyone who invested pre-2008, and they will tell you that one of their biggest regrets is selling real estate assets during that period. If only they had held on they would be in a far stronger financial position today.  

  1. You’ll Regret Not Buying More In The Dip

Even more than selling, most regret not buying a whole lot more houses in the last dip. Many of those properties may have doubled or quadrupled in price since then, along with the income they are producing. Even buying a few dozen more in that phase of the market could set you up for the rest of your life. 

Investment Opportunities

Find out more about investing in secured debt and real estate, go to NNG Capital Fund.