The real estate industry is an industry that can boast of having the richest men and women as major players. There is hardly any successful business person who doesn’t own a real estate portfolio. This is so because properties scarcely depreciate in value – if it does, it is only in rare cases and they always bounce back after a while.
The question is not if you are interested in the real estate industry, but when is the right time to invest in this highly lucrative industry. Knowing when to invest as a business man or woman is a one of the skills that differentiates an average investor from a highly successful investor. The truth is that, if you don’t know how to study the trends in the real estate industry, you are likely going to invest at the wrong time and you may run at a loss.
Loads of real estate investors do not know when to invest in real estate; hence the purpose of this article is to provide you our esteem readers the tips needed to know the right time to invest your hard earn money in the real estate industry so as to maximize profits. Now let us quickly consider 5 surefire tips that will help you know the right time to invest in real estate;
How to Know the Right Time to Invest In Real Estate
1. The Right Time to Invest In Real Estate Is Now
Simply put, the best time to invest in real estate is now; being apt as an investor is a skill you must learn. If you are contemplating doing anything, in most cases it will be best for you to just go ahead and do it without delay. The truth is that, procrastination has robbed many investors of the golden opportunity of hitting goldmine in their business.
So if you see a property that you can afford, there is no point wasting time, you can just go ahead to purchase the property. It might be risky to do so, but the fact remains that risk is a major component in business. If you are averse to risks as a business person, you are likely not going to make it big in your line of business. Statistics shows that most deals that bring in huge returns on investment are those deals that have 50% or less success rate and 50% or more failure rate.
2. The Right Time to Invest in Real Estate is When The Interest Rate Is Low
Another key indicator that will inform you of the right time to invest is the interest rate in the bank. The right time to invest in real estate is when the interest rate is very low; that is when you can maximize borrowing money from the bank.
So if you are planning to borrow money to invest in the real estate industry, ensure that you only borrow money when the interest rate is low; a single digit interest rate is ideal especially if you live in Africa. No matter how tempting a property is if the interest rate for borrowing money is still very high, it will be advisable not to borrow to buy the property especially if you are not interested in keeping the property for a long period of time.
3. The Right Time to Invest In real Estate is When There Is Economic Recession:
If you are looking for the right time to invest in real estate, then you have to look towards the period of economic recession. When there is economic recession, loads of people will look for any available means to stay afloat and part of what they would normally do is to sell their properties at rock bottom price.
So if you are privilege to have enough cash at hand during economic recession, then you should target properties that are put up for sales; don’t be afraid to bargain. The truth is that once the seller knows that you are a serious buyer, they are likely going to dance to your tune even if it means to sale the property for half the price it was listed for.
4. The Right Time to Invest in Real Estate is When the Price of Properties Drop
In the law of demand and supply, more goods are sold when the price is low and less goods are sold when the price is high; so the right time to invest in properties is when the price of properties drop. It is wise to invest in properties when you can buy homes et al at a cheaper price. As an investor, if you want to invest in real estate, you should take your time to monitor the industry so that you will be able to identify the periods when the prices of properties drop and then make plans to invest. In some cases, you might buy a property today and sell it twice or more of the amount you bought it within few days or weeks.
5. The Right Time to Invest in Real Estate is When You Have The Money
Another key indicator that will tell you the right time to own a real estate portfolio is when you have the money. Perhaps you might win a lottery and you have enough money that you don’t have plans on how to spend it, the best thing to do in such situation is to look for properties to invest in. You can also invest in real estate when your parents or relatives willed huge sum of money to you – that is just the right time to invest if you have not made up your mind on what to do with the money.
There you have it; the 5 surefire tips to know when to invest in real estate.
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