Property valuations in many areas have likely reached or are near bottoming, becoming generally affordable again. Interest rates remain low and the economy shows continuing signs of strengthening; great indications that it’s an ideal time to invest in U.S. real estate.
Successful investing in real estate is often about timing but the old adage remains true. It’s still very much about “location, location, location.” But when considering areas to bring investment dollars, we should think in terms of which cities are currently experiencing (and expecting) positive economic conditions and other relevant factors. The “sexy” choices and decisions can easily become financially unsound.
Only when indicators are favorable and an area is determined to be an emerging opportunity should a market be seriously considered for yourself or clients. It’s almost always unwise to make real estate investment choices based on emotion or convenience. The results of correct due diligence should govern all investment decisions. Certainly, there can be no desire or intention to invest in cities that have been experiencing stagnant or declining home values and prices.
Choose to invest in emerging real estate markets…
When we consider markets and sub-markets for investing we analyze many factors, including:
- Property valuations price index
- Depreciation risk levels
- Median income to median home price
- Current and future business economy
- Anticipated employment trends
- Projected population growth
- Monthly rent to price ratios
- Current and historic vacancy rates
- Current foreclosure rates
- Owner occupied neighborhoods
- Present available housing inventories
- New home construction projections
Once a city has been qualified as emerging and deemed safe for investing, then accurate calculations can be made regarding built-in equity (immediate gain), positive long term cash flow and appreciation over time.
Intelligent and timely decisions translate to great returns on real estate investments during this period of time. Conditions are perfect to get off the sidelines as high value opportunities (bargains) exist throughout the country.
And there’s very little gamble when you know what you’re doing…
Founded and operated by Mathew Owens, CPA, and based in Redondo Beach, CA, OCG Properties is a real estate investing company that provides numerous financial, educational and investment services to its community of clients.
Owens Consulting Group founder Mathew Owens is a California licensed CPA and a full time real estate investor. He has completed over 100 transactions in the past three years, representing approximately $10 million in real estate, most of which has been sold to cash flow investors. He does mulitple live educational events and online webinars. Find out more info about him and his blogs at www.ocgproperties.com