From 2022 through 2025, investors navigated a complex mix of rising interest rates, tightening credit, and shifting asset valuations. But those who stayed grounded in fundamentals didn’t just survive; they found new ways to thrive.
Here are key lessons from this era that remain highly relevant for today’s market:
1. Liquidity Isn’t Optional… It’s Strategic
The biggest winners of this cycle weren’t necessarily the most aggressive; they were the most prepared. Investors with strong cash reserves weathered rising costs, delays, and shifting valuations without being forced into unfavorable sales or refinances.
Takeaway: Aim for deep reserves, not just the minimum. Capital on hand gives you the flexibility to solve problems quickly, seize time-sensitive deals, or simply sleep better at night.
2. Fixed-Rate Debt is a Defensive Weapon
As variable-rate borrowers saw monthly payments climb and rate caps renew at eye-watering costs, investors with long-term, fixed-rate financing found themselves in a position of strength. Many didn’t have to refinance at all and could simply wait out the turbulence.
Takeaway: When rates are volatile, stability becomes an asset. Lock in long-term debt wherever possible, even if it means giving up a bit of leverage.
3. Capital Structure Discipline is a Long-Term Advantage
Over-leveraging was tempting in the low-rate era, but it proved costly as debt markets tightened. Investors who limited loan-to-value ratios and avoided aggressive bridge debt had more room to maneuver when valuations adjusted and lending guidelines changed.
Takeaway: Conservative capital structures aren’t just about risk avoidance, they’re about staying in control when the unexpected happens.
4. Strategy Matters More Than Speed
From 2020 to 2022, the market rewarded speed and volume. But when the tide turned, thoughtful operators with disciplined underwriting and clearly defined exit strategies fared far better than those chasing scale for its own sake.
Takeaway: Growth without a margin of safety is gambling, not investing. Prioritize strategy over size.
5. Small Assets Proved Surprisingly Resilient
While larger multifamily and commercial assets experienced significant paper losses due to cap rate compression and loan maturities, smaller residential assets (particularly single-family and 2–4 unit properties) held their value and even appreciated in many markets.
Takeaway: In times of uncertainty, simple, cash-flowing assets with low turnover and long-term debt can outperform more complex, capital-intensive strategies.
The Bottom Line
At Dominion Financial Services, our lending model is built for investors who prioritize long-term stability and short-term agility. For rental portfolios, our DSCR Price-Beat Guarantee helps investors secure the most competitive fixed rates because consistent cash flow begins with consistent terms. For value-add strategies, our bridge loans cover up to 100% of acquisition and rehab costs, giving experienced operators the leverage to act quickly without tying up working capital.
In a market where execution and efficiency define success, Dominion remains a reliable partner through every cycle, in every environment.
