Good morning & happy Wednesday!
So far we have talked about
WHY we might invest in real estate, and
HOW we may go about doing it.
Today let’s talk about WHERE.
WHERE should we invest in Real Estate?
When deciding where to invest, it is first critical to understand what makes a housing market “hot”.
The U.S. housing market is dependent on…
- The money supply
The more money circulating, the more people have access to credit, more people can buy houses, supply goes down, prices go up
- The economy
Buy low, sell high – when the market is down & interest rates are low – buy, buy, buy.
Home ownership was at record lows in 2017 in the U.S. despite low interest rates – why?? Currently, the majority of the U.S. population has low savings & high debt and therefore, do not qualify for a mortgage.
- Job growth
Where corporations move, people follow – make sure job growth is on the up & up where you are investing
- Population growth
Follow the millennials & baby boomers!
- Demand vs Supply
Low demand & high supply = low prices, low supply & high demand= high prices
- Housing affordability
Check out your capitalization rates
SO, where should we invest?
Based on 2017 market reports – the southern half (ish) of the U.S. seems to be the place to go.
States like Florida, Ohio & Texas have multiple large cities for you to choose from with high cap rates & decent housing prices.
Cities like Pittsburgh (Go Pitt!), Detroit, Kansas City & Binghamton (not the south BUT Hello Tiny Home!) are also on the up & up.
By tracking the job market, population growth, supply & demand, and housing prices across the U.S., you can determine where the next “hot” spot may be for us investors.
Again, thank you so much for being a part of this and please know that I am open to any and all feedback on how this is structured, content, writing style, etc. As we go forward, I hope to make this more analytical, factual, and even just helpful as we all work to build our real estate portfolios.
Happy new year!
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