The average W-2 employee depends on the success of the paper asset markets to succeed. The logical thing for that person is to pour as much money as possible as soon as possible into those markets. Market timing is difficult, and they rely on the growth in value over time rather than waiting to buy low. Over 20 to 30 years, that should work out well in most cases.
Business owners, including real estate portfolio owners, look at capital a bit differently. They generally have significant cash reserves to meet the business expenses, including reserves for when the revenue decreases. They tend not to invest in more assets unless the business can put them to productive use and achieve the desired rate of return on the purchase. Warren Buffett says he hates cash, but he is always sitting on a lot of it, waiting for something to buy that meets his target rate of return.
Astute investors also know how to raise money when opportunities appear. They can find partners and lenders more readily than the W-2 employee. If they find the opportunity, they can generally raise the capital.
Speculative investors are often people with a lot of cash burning a hole in their pocket. This is what we see with the overseas money that has been pouring in. When the markets turn, some of those folks will fold. Others will hold on until the market recovers. There will be a lot of buying opportunities in HCOL markets if and when the foreign money pulls out. If you have cash or access to cash then, you will profit when the HCOL market recovers.
