More than a third of investors plan to buy zero properties this year, according to a recent sentiment survey, despite 38% expecting market conditions to improve. This gap between optimism and action is costing investors, especially in markets like Southeast Michigan where apartment rents are still climbing and buyers outnumber sellers. Larry Gotcher, owner and broker of Resource Realty Group in Ann Arbor, Michigan, has observed this pattern through every major cycle since 1991. His assessment is direct: “Investors are way too picky about what they’re buying. Purchasing real estate in America is one of the most lucrative things you can do. It’s hard to go wrong, even if you make a mistake, because you get your appreciation back over time.”
Being selective and being paralyzed are not the same thing. Caution can protect from bad investments, but excessive selectivity keeps investors on the sidelines while properties appreciate without them. Gotcher argues that building meaningful portfolios comes from closing more transactions and winning a little each time, rather than waiting for a landslide victory on a single deal. “You don’t have to win the lottery on every deal,” he says. “I would rather close more transactions and win a little bit every time. In the end, you’re going to win bigger because you own more property.”
In a market like Southeast Michigan, where apartment inventory has been chronically short for decades and rents have increased consistently, holding out for perfect conditions means watching entry prices climb while the ideal moment keeps moving further away. Gotcher has identified two questions that signal a buyer who won’t close. The first is asking why the seller wants to sell. “Why does anybody get into real estate? Buy low and sell high,” says Andrea Gotcher, who handles residential transactions and analytics at the firm. “They’re just wanting to move on to a different project, or they want their money.” The second is asking to see the seller’s financials to assess past performance. “What somebody else has done to run their business into the ground doesn’t matter,” Andrea Gotcher says. “We know our area. We know what we can do with the property. We base our numbers on that.”
For investors with genuine market knowledge, the correct lens is what you can produce given your operating expertise, financing, and management approach. Gotcher’s acquisition criteria are simple: properties need to cash flow at or above zero after debt service. Breaking even monthly is acceptable because tax depreciation generates a real return on top of that, and long-term appreciation does the rest. A deal that looks unremarkable on paper today tends to look like a solid decision five or ten years out. “The key is owning as much real estate as you can,” Gotcher says. “If you’re too picky about what you buy, you’re not going to acquire very much real estate.”
The single principle that runs through every piece of advice Gotcher gives is this: buy and hold. “Don’t be scared by temporary market conditions that force you to sell,” he says. “Make sure you hold as long as you can.” That applies in a high-rate environment, in a flat market, and in a downturn. Investors who sold into fear during the 2008 cycle in resilient markets like Ann Arbor came out significantly behind those who stayed in. Time corrects most underwriting errors in real estate in ways that are almost impossible to recover from if you are sitting on the sidelines. The market today, with rates still elevated and many buyers waiting for conditions that may never arrive, is another version of the same test. The investors acquiring now at reasonable prices with sound assumptions will likely look back at this as a good entry point, while those waiting for certainty will face higher prices.
Resource Realty Group is a full-service commercial and residential brokerage headquartered in Ann Arbor, Michigan, led by Owner and Broker Larry Gotcher. The team has built a reputation for closing high-volume commercial transactions through deep market knowledge, disciplined process, and creative deal structuring. The group also manages land development projects and operates a REIT designed to provide investors with access to resilient, income-producing real estate across Michigan and international markets.
This article is based on information provided by the expert source cited above. It is intended for general informational purposes only and does not constitute legal, financial, or real estate advice. Readers should conduct their own research and consult qualified professionals before making any real estate or financial decisions.
