How did RIC and its investors do during the 2008 crash?
Real estate is a non-liquid investment. During 2008, when everything went down, the close in real estate mostly held its value. There were a few that went down. There are still a few that are going down now depending on who's selling. If you go into a neighborhood and you find a neighborhood is full of short sales and foreclosures until those were absorbed, probably it's going to go down.
Our properties have basically held value due to their locations but again if you're in a bad market and you must sell, and you're an asset that is not liquid, you're going to lose money. When you go into real estate, you need to have some cash reserves. You need to be in a situation where you're not forced to sell something when you need it. We recommend to a lot of our clients to have equity lines, and to use their equity lines like a savings account. Instead of leaving your money sitting with a bank where you get 0.2%, if you need money for something that's important, you take it out of your equity line and the moment you have cash, you put it back.
A good size equity line can protect you during a period of time when you don't want to sell.