Investing in real estate is not easy. As an investor, you have to choose property that will appreciate in value for resale. In case you don’t want to sell, you should be able to rent the property so that you can recover your investment before you sell. This means picking commercial or residential property that fulfills these requirements. Pre-2009, this was simple states Jeff Adams, but the recession changed all that.
The mortgage crisis affected the real estate market and changed it completely. Now, investors have a huge variety of real estate to choose from and they have to be very careful while picking property due to several reasons.
What to Watch Out For In 2015
Jeff Adams #1 Real Estate Trainer, industry expert and market professional, is optimistic. He points out that 2015 is a very good market for first-time buyers and small investor due to several factors.
- Satellite Cities – One of the major problems for investors has been lack of inventory. Large cities like New York have already reached saturation point regarding supply and prices are too high for investment. However, smaller satellite cities are now becoming popular as investment options due to their proximity to large cities.
Localities like Raleigh-Durham, Brooklyn, Queens, and Charlotte are popular with investors as they have been developed with enough amenities to make them prime residential hubs.
- Changing Demographics – The Millennial generation is entering the job market and as job security increases, salaries are increasing. However, the baby boomer generation is still around. They have not yet moved to retirement communities and they are still active in the job market. As a result, with an increasing amount of stable labor entering the market, there is a very good chance that the number of first-time homeowners will increase.
- Flaring Rental Rates – Another reason that first-timers buyers will increase, is the slow but steady hike in rental rates. Millenials are currently renting property but as rental rates keep increasing, they will actively think about investing in real estate
- Lack of Foreign Investors and Big Investors – The number of foreign investors and large companies investing in real estate will decrease. As the dollar increases in value, they will no longer find it affordable to invest in property. In fact, buyers will also find lease-to-buy options, foreclosure properties, short sales, and new properties to invest in.
In Conclusion
For small investors, 2015 is a good time to buy. Large investment companies and foreign investors are out of the picture. Foreclosure and short sales are available. New construction is on a rise and the best news is that mortgage rates are still affordable. With so many advantageous factors, it would be a good idea to start investing right away.
If you are doing this for the first time, make sure you research the market before do anything.
It’s a new year and the 2015 real estate market is very, very different from the real estate market of 2013. Be cautious but be proactive, and make an investment before mortgage rates increase.
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