Jeannie Niles Real Estate Investment
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Investing In A Changing Market
Updated February 25, 2009
Now that you have memorized the basic strategies of investing in a separate article on this web site………it’s time to look at current market conditions and what we should be doing.
The current market is in the most serious downturn I have seen since starting my real estate career in 1977. On a positive note, we have the lowest interest rates available since the 1960’s. I can even recall thriving in a real estate market in the early 80’s when mortgage interest rates were 18%!
Remember…..money can and will be made in “ALL markets”. You must have staying power, i.e, cash liquidity, and purchase properties that will do well in the long term. My definition of long term is at least five (5) years.
Bank owned properties have been coming on the market at very attractive prices…..prices are the same as they were five or six years ago in many instances. Rents are falling due to unemployment but not as much as prices have fallen, thus an attractive cash flow is possible on many properties currently available.
Duplexes for $180,000+
Condos in the low 100’s
SFR’s 2000 sq.ft - high 100’s
Multi-Family with cap rates at least 6% or more.
Monitor the market and work with a Broker that knows the area, the properties, rents and market conditions.
There is almost no new construction being completed. At some point, existing inventory will decrease substantially, and demand will increase for existing properties, for purchase as well as for rent. Many reports project hyper-inflation…….I won’t go that far yet, but the normal curve of supply/demand will swing back in favor of investors, insuring a nice profit….especially if you have a long term fixed rate loan at today’s interest rates.
Basic Investment Info
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While your strategy will change depending on the market, there are 4 primary ways to make money in real estate.
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When crunching the numbers on a property, you'll often encounter some real estate lingo. Here's what things like 'cap rate' mean, and how to use them.
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There are some basic strategies that apply across the board no matter where you are investing or what the current economic conditions are.
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Good brokers don't simply sell you property, they help you define your investment strategy.
Investment Strategy
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Now is the time to be buying! Aggressively priced properties are selling over listing price with multiple offers.
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While almost everyone says they invest for “MONEY,” in reality, we all invest for what we expect the “MONEY” to provide us. Read on for info on defining realistic goals and developing a strategy to achieve them.
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Compared to other types of investments, real estate provides you an incredible amount of control over your property.
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When I work with a client, I try to match the type of property to the investor's personality and portfolio.
Optimize Your Portfolio
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I always encourage my clients to “never be sellers” but there are times when a property needs to be eliminated from a portfolio.
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If you currently have an option loan, also known as an exotic loan and want to get out of it, there are some serious issues to address.
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Good property management is the number one factor in the success of your real estate portfolio.
Every investor's situation is unique, and I have over 25 years experience solving problems. Use the form below to ask me about your unique needs.
Jeannie Niles Real Estate Investment
P.O. Box 317
Palm Desert, CA 92261
P: (760) 360-4020
F: (760) 340-9069
E: jniles@realestate-investment.com
