The real estate sector tends to be more stable
The Great Depression and the dot-com bubble turned the stock market upside down, but real estate investors did not suffer serious losses. In fact, single-family rental assets posted positive values as a sector at the end of the Great Recession.
Small-scale residential real estate investments are not part of day-to-day trading activities, like stocks. As such, they provide stability when stocks are volatile.
Buying investment property is undoubtedly an attractive and valuable decision with many financial benefits. But before you write that check, here are some tips to help you make an excellent home buying decision and maximize your short and long term investment properties.
We recommend you to follow two rules that will help you maximize your real estate investment.
Consider the location
When evaluating properties to buy during an economic downturn, know the complete lay of the land. It is vital to remember that the goal is to buy the place, not the house. Therefore, look for areas with stable employment and job growth potential.
The job market can disrupt your rental income plans. Tenants may not be able to pay rent and move to another area if they have been laid off and have difficulty finding a new position.
In addition, consider lifestyle as well. Make sure you follow the trends. Are people looking for urban housing? Or in large, natural spaces? Near the sea?
In 2020/1, we saw a significant shift to the suburbs and rural/coastal areas due to the rise of remote work and the desire for more space. Will this change in 2022/3 with the next recession?
Think cash flow.
Another rule to help you make the best real estate transactions is to keep cash flow in mind. For example, think that you are looking to include a property in your portfolio during an economic downturn. In that case, take a look at properties with excellent cash flow. These are properties that still have cash coming in after eliminating expenses and mortgage payments.
These properties will help you minimize the risk of even a recession.
⇒ Important to note ⇐
Recession does not equal a housing crisis.
History shows that an economic slowdown does not equal a housing crisis. In 4 of the last 6 recessions, home prices appreciated. Home prices only fell twice in the early 1990s and then nearly 20% during the 2008 housing downturn.
In short…
No one wants to suffer in a bad economy. It disrupts our finances and could drastically reverse the course of our lives. But for property owners, this doesn’t have to be the case. On the contrary, an economic downturn can put you at an advantageous point where you can benefit from the crisis.
With Your Real Investmentyou can rest assured that you will be
personally attended to, to empathize with your possibilities and objectives.
By anticipating and covering all possible future events, we already have ideal options to safeguard your capital and increase it in the short term.
Investors, both novice and experienced, have already joined them.
Would you like to meet them? ⇒ Just contact us ⇓
We will take care of everything.
