Top 5 Reasons why Real Estate is still a good investment opportunity
Boom and Bust
Mention the words real estate investment, and there is a good chance some people may get the jitters. This is only natural considering the recession of 2008 and all the nasty fallouts from it, only recently settled down. To be fair, the real estate business is like any other business, it goes through a boom and bust cycle. There are many reasons for this. Therefore, just concentrating on a few negative reasons and staying away from it is not a good idea. There is even a term for this in the world of business, and it’s called a recency bias.
Even in a bust cycle, there are plenty of opportunities. For example, in the bust of 2008, there were a lot of investors who took advantage of Texas real estate investment and its lower prices, bought property, and then waited for the gains that followed and sold. In some cases, realtors were making a 200% gain! So, in a way, you could say there never is a bad time as far as real estate transactions go, as long as you do your due diligence.
We’ve all heard the popular expression realtors like to use “location, location, location” when it comes to buying a house. Besides the obvious reason, such as not building a house next to a smelly recycling plant, there are other geographic reasons to consider. One of the best examples of finding the right location would be a city that is experiencing fast growth. Identifying a city that is increasing in its population mass, is one of the best ways to find a booming market. Within the city, there will obviously be areas that are better than others, such as beautiful geographic locations, school districts etc.
Top Five Reasons for Real Estates Popularity
One of the main reasons why real estate investing is popular is because of its tangibility. Unlike many other forms of investment, housing prices are not changing every day depending on the mood of the media. Therefore, in the US, or anywhere for that matter, one of the most popular investments is real estate development.
The next reason for real estate investments popularity is leverage. If you or your company has good credit, then banks are willing to back you on your investment. This is in part because banks also see the long-term value in a good real estate investment.
The third reason on the list is that real estate prices are the lowest they have been. Ever since the crash of 2008, people have been taking advantage of all the foreclosures. The benefits of all this for you is that you can buy low and sell high.
The fact is that real estate has always been a good long term investment. In fact, real estate prices have only gotten better in the past few decades, despite any economic downturn. And if there are any apartments or housing with tenants, then that’s just an added layer of security.
Last but not least, eying the immigrant population has been a popular way to do real estate speculation. In fact, most of the major cities in the US for example, are buying and building with the wealthy immigrant in mind. This may be a recent trend, never the less it is shaping up to be an extremely lucrative business.