How is the economy affecting how your closings and what are you doing to deal with the current downturn?

My best friend is a single mother that supports her family. She has been in commercial real estate for 7 years now and she says she has never seen it this bad. She’s been consistently closing and has built up her career to the point where people call her multiple times a day to inquire about deals. She has been closing every two to three months on average. She says her phone barely rings these days and that no one wants to buy anything at the moment because the interest rate is so high that it just doesn’t make the deals worth it. How are you dealing with the down economy, crazy interest rates, and what tips and advice can you give to overcome this hard time in the economy and try to make some money? I don’t even know what to tell my best friend. She is struggling and thinking of dropping her career in commercial real estate.
[{"id": "ivdm8ly", "text": "I have never been through a cycle, but many producers in my office have. Deals can 100% be done, but they aren\u2019t the pretty ones and they aren\u2019t plentiful. The advice I\u2019ve gotten is this is a time to act as an advisor, and give real guidance to your clients because when these bad times eventually end then they will turn to the people you actually helped them.", "replies": [{"id": "ivdmfzk", "text": "You mean like paid consulting? Or free advice to gain loyalty? For now my best friend is panicked that her savings will only last her a few months so she needs to do something now.", "replies": [{"id": "ivdmu26", "text": "Commercial real estate means doing a lot of work for free and going months and months without a deal.", "replies": [{"id": "ivflejp", "text": "Can confirm. Only turn months and months to 1-2 years in a recession/crazy high interest rate environment. I wasn\u2019t a rain maker by any means but if you are not one then it can be a miserable way to make a living when times are rough. When u have a wife and kid(s) and the question of when the next deal is closing comes up, and there\u2019s no good answer, it\u2019s time to make some decisions.", "replies": [], "depth": 4}], "depth": 3}, {"id": "ive6g39", "text": "Honestly, commercial rela estate is not a good field for someone who need a consistent paycheck, the income volatility is really going to be hard to deal with.", "replies": [], "depth": 3}, {"id": "iveu1k5", "text": "It's nearly impossible to say without knowing your friend's market and specialty... But if you've been in this business 7 years, you're the sole provider for yourself and kids, and you don't have more than a few months in savings, you probably have bigger issues. 6 months of savings is a general rule we try to teach single W2s without children. I would want to have 2 years of expenses covered by savings if my fiancee didn't work an essential 9-5.\n\n\nWhat is your friend's specialty and can you give a general description of her market? In my market, we're still working because cap rates are climbing, but still at historic lows. So owners can still put a win on the books by selling now and 1031-ing to a blue chip investment in a core market.", "replies": [{"id": "ivevl5d", "text": "She\u2019s in the investment sales market in NYC.", "replies": [], "depth": 4}], "depth": 3}], "depth": 2}], "depth": 1}, {"id": "ivdntgq", "text": "It sounds like she's a broker, they'll have it tough. But high rates are just part of an equation, she'll be fine if she can stick out... Maybe she can try working a more steady job, like for a developer?", "replies": [{"id": "ivdpj8d", "text": "What type of jobs are developers looking for? Like acquisitions?", "replies": [{"id": "ivdrmc1", "text": "Acquisitions, dispositions, asset management. For sure, yeah.", "replies": [{"id": "ivhkl0o", "text": "I\u2019m in acquisitions and the problem I\u2019m starting to see is a drop in new inventory combined with sellers standing firm on their pricing that was 25% too high 6 months ago.", "replies": [], "depth": 4}], "depth": 3}], "depth": 2}], "depth": 1}, {"id": "ivdqrtq", "text": "Which market is this?  Doesn\u2019t sound anything like mine.  If you\u2019re a good broker you always find deals in any cycle.", "replies": [{"id": "ivevrdy", "text": "NYC investment sales market", "replies": [{"id": "ivewz3y", "text": "Yeah she\u2019s gonna have a rough go at it for a few months in that market, but that\u2019s part of the business and anyone that\u2019s been in it for 7 years should understand that and be prepared for the cycle change.", "replies": [], "depth": 3}], "depth": 2}], "depth": 1}, {"id": "ivdybjo", "text": "Tell her to try Costar.", "replies": [], "depth": 1}, {"id": "ivdyvju", "text": "Deals are still getting done, buyers are just getting more selective with bigger private equity firms putting their pencils down all together which creates an opportunity for smaller investors to win deals. Just make sure your deals are priced correctly and know how to back up your pricing because you will be given any reason to negotiate a re-trade. Know what Cash-on-Cash clears your market and do not market deals that are not realistically financeable in this market. Also seller-financing is another creative way for sellers to expand the buyer pool and create more activity, just have to be able to qualify buyers effectively", "replies": [], "depth": 1}, {"id": "ive2w68", "text": "if you voted for Biden again, then you haven\u2019t learned a lesson from the past 2 years. it\u2019ll get worse for all RE agents", "replies": [{"id": "ive5457", "text": "Agreed. Trump train baby", "replies": [], "depth": 2}], "depth": 1}, {"id": "iveocca", "text": "It depends on which phase and sector the deal is in. Phased SFL take downs are stopping. MFH debt and equity has dried up for the remainder of the year. Retail is still moving forward but slowing. Retail/Industrial deals are going to have to be retraded which is slowly becoming accepted by tenants. As someone who has been thru the last cycle, this is why you dont spend all your monies and keep a large amount ready to ride out the next recession.", "replies": [{"id": "iveolf9", "text": "She focuses on development sites and multi family properties in the NY market. What market do you recommend she focus on?", "replies": [{"id": "iveub1t", "text": "I mean CRE is very location driven, it takes years to really understand the market. Does she work for a developer? Owner? Investment sales? I see ground up stuff slowing down which will hopefully lead to reduced construction costs. That said, cash buyers will be active during these times. The sand states aka Florida/Texas/Arizona/ will fare better than most. Some people might see land banking opportunties.", "replies": [{"id": "ivevson", "text": "Investment sales NYC market", "replies": [{"id": "ivezfac", "text": "Find some buyers and start looking for offmarket deals.", "replies": [], "depth": 5}], "depth": 4}], "depth": 3}], "depth": 2}], "depth": 1}, {"id": "ivh48jj", "text": "Rates aren\u2019t crazy high - they\u2019re just reverting to the mean. The decade of free money from the Fed had to end at some point. Investors now need to reset expectations and buyers / sellers are at a huge bid / ask spread until that happens.\n\nWhen rates for core deals are at 6%, cap rates can\u2019t be 3-4% and make sense, especially with recession preventing investors from growing out of negative leverage.", "replies": [], "depth": 1}, {"id": "ivhdsiq", "text": "Living off the the savings I put away during the boom by not changing my lifestyle, like every other cyclical business? \n\nAdding licensures. \n\nStarting an embedded insurance brokerage in a car dealer group?", "replies": [], "depth": 1}, {"id": "ivhqwny", "text": "I\u2019m looking for deals in every damn place, abb listing at 400/night sure I\u2019ll do it for $250.", "replies": [{"id": "ivilil9", "text": "ABB LISTING?", "replies": [], "depth": 2}], "depth": 1}]