Alright, let’s get real for a second. We need to talk about something that’s been on my mind lately, something that’s been pretty obvious to anyone who’s been paying attention. But before we dive in, let me ask you a simple question: where should you be investing your money right now?
I know, I know, everyone has an opinion. Your next-door neighbor who’s still wearing socks with sandals probably has an opinion on this, too. But I’m asking you, right now, where should YOU be putting your money? And no, “the mattress” isn’t an option, though I’m sure that feels like a safe bet for some.
This question is not coming out of nowhere. Let me tell you why I’m asking.
The Fixer-Upper that Sold for $200,000 Over Asking Price
Let’s rewind a bit. Just last week, I came across an article from The Insider that blew my mind. I’m talking about a fixer-upper in Washington, D.C. that received 76 cash offers and sold for a whopping $200,000 over the asking price. Let that sink in for a second.
Now, before you start thinking that the market is just “heating up,” let me clarify what I mean. A fixer-upper in D.C. is not some newly renovated, turn-key property. No. This was a property in bad shape. I’m talking about the kind of place where you can’t even tell if the walls are painted or just… covered in mystery stains. It’s ugly. And here’s the kicker: it’s not even in D.C. It’s outside of the District of Columbia.
So, why the heck would someone—let alone 76 someones—pay $460,000 for a rundown property that’s technically not even in D.C.?
The Only Answer: Lack of Other Options
Now, here’s the part that really gets me. The only reason I can think of for these 76 investors paying way over the asking price is that they honestly couldn’t think of anywhere else to put their money. They just didn’t have a better option. It’s like when you’re starving, and the only thing available in the fridge is a sad, limp lettuce leaf, so you just grab it and say, “Eh, it’s better than nothing, right?”
The fact that these investors had no other place to invest their capital speaks volumes. Either they weren’t looking hard enough, or worse—they were being lazy.
And don’t even get me started on the idea that this could be the best opportunity available. If you’re putting your money into something, and you’re overpaying for it, what happens? You’re over-leveraged. You’re overexposed. You’re setting yourself up to get less of a return.
But guess what? The market’s full of people willing to overpay right now. I’ve got a hunch that a lot of these investors are thinking, “Well, if I overpay now, I can probably flip it and get a higher price on the back end because there’s little to no inventory on the market.”
Okay, fine, I get it. In the short term, you may be able to cash in, especially with the current market conditions. But there’s a massive risk involved.
The Market’s Inevitable Correction
What happens if the market corrects? What if, by some stroke of luck, the bubble bursts and all these overpriced properties fall flat? Suddenly, you’re stuck with an overvalued property, and you’ll be scrambling to figure out how to refinance.
Let’s face it. That’s a nightmare scenario for anyone in real estate. And it’s not a question of if this will happen; it’s a question of when. Markets do this. They fluctuate. They correct themselves. And you don’t want to be holding the bag when it does.
The Supply/Demand Imbalance: What’s Really Going On?
So, what’s the root of all this madness? Well, here’s the issue: there are too many realtors and too few homes on the market. Simple math, right? Too many people trying to sell too few properties. The government is kicking the can down the road, and we’re stuck in this weird shortage. That shortage is keeping prices sky-high.
Now, I know what you’re thinking. “Okay, so what? What should I be doing with my money then?” Well, if you’re sitting on cash, the answer is actually pretty simple: don’t jump into the bidding wars. Take a breath. Hold tight.
Here’s where I think people are missing the boat.
The Underused Opportunity: Buying Established Businesses
Have you ever considered investing in something other than real estate? Like, what if I told you that you could purchase an established business that’s ready to operate and already has an existing customer base?
Now, hear me out on this. I’m not talking about buying some random shop on the corner. I’m talking about businesses that are owned and operated by baby boomers who are ready to sell and retire. These businesses may not be using the latest tech or have the fanciest apps, but they have value. They’ve been around. They’ve proven themselves. They’ve made money for years.
And guess what? You can buy them—often at a fraction of what they’re truly worth.
Ghost Kitchens: The Next Big Thing?
Let’s talk about something that’s actually on the cutting edge: ghost kitchens. Don’t know what a ghost kitchen is? Let me fill you in.
Ghost kitchens are essentially local kitchens that any chef or business owner can rent to make food for delivery. They don’t have a storefront. They don’t have tables or chairs. They don’t even have a sign outside. But what they do have is the ability to prepare and deliver food at a lower cost, and with a higher margin than traditional restaurants.
In my local market, there’s a company called ClusterTruck that’s doing this. They set up a kitchen, add a little tech for online ordering, and boom—delivery food at a fraction of the cost of a typical restaurant.
This is where I see the future going. This is the real opportunity. Traditional restaurants are already struggling to keep up, and ghost kitchens are becoming the new normal. Imagine owning part of a business that doesn’t require the overhead of a physical location and doesn’t rely on outdated business models. That’s where the money is.
How to Invest Smartly Right Now
So, let’s get back to you. What should you be doing with your capital?
First, if you’re going to invest, I’d suggest two things:
- Purchase equity in companies. I’m not talking about buying stocks—I’m talking about true ownership. This means investing in companies that give you a tax benefit, and that’s something you can’t get from a regular stock investment.
- Hold onto your cash. Don’t get sucked into the hype of the market right now. Don’t get involved in bidding wars. Hold your money until the market turns—or look into secondary and tertiary markets.
You don’t need to invest in the big markets like D.C. or Charlotte, where prices are outrageous. Look at the smaller markets. There’s plenty of opportunity there. You just have to know where to look.
The Takeaway
The key to investing right now is simple: don’t be lazy. Don’t just follow the crowd and overpay for a property that you’re not even sure is worth it. Don’t think that the only way to make money is by jumping into real estate. There are other ways to build wealth—and sometimes, they’re easier and less risky than what the masses are doing.
Hold tight. Be smart. And remember, there’s always another opportunity out there. You just need to find it.
Peace.
