Investing in real estate isn’t a decision you take overnight. It’s a calculated decision, one that you take after closely monitoring the real estate market. You need to analyze the real estate market and then decide to invest. 

However, if you see a good investment opportunity, you also have to make sure you’re ready to invest. Michael Gailliot Homes brings you tips on monitoring the market and signs on when to invest in real estate.

Tips to Monitor the Real Estate Market

Examine the Historical Data

Review online reports on the real estate market’s performance from the National Association of Realtors (NAR) to discover the types of properties on sale and their price.

Look at the Target Market and Neighborhood

Once you have selected the area, you need to canvas the area to learn more about it. You need to obtain the following information:

  • Overview of the real estate market
  • Population data and employment growth
  • Education levels of major employers and employees
  • The city and metro area’s local housing real estate market activity
  • Past, present, and future real estate market trends for rental properties
  • Quality of life rankings for forecasting future demand for properties

Gather Unbiased Data from Several Sources

Go online to gather unbiased data from several different sources. Some resources to obtain data include:

  • Community websites
  • Local newspapers
  • Social media
  • Investment clubs
  • Online investment portals

Understand the Market Factors Affecting Investment Strategy

Are you interested in a long-term buy-and-hold strategy or properties with rapidly increasing prices? You’ll choose a market to invest in once you have chosen your investment strategy. After that, you need to know the market factors that can influence your investment strategy. They include:

  • Types of properties in high demand
  • Most active investors and real estate agents
  • Percentage of rental homes
  • The location of the major employers
  • Housing inventory stock
  • Identifying the local home wholesalers

Perform Market Analysis

When you’re performing a real estate market analysis, use the recent sales prices instead of the asking prices of properties currently on sale. The listing price is what the seller wants to get for their home, whereas the final sales price is what the seller receives after the sale of the home. Follow these steps to perform a real estate market analysis:

  • Research the neighborhood amenities and quality
  • Get property value estimates for the neighborhood
  • Choose six comparable properties for your real estate market analysis
  • Calculate the average price of comparable properties
  • Adjust your real estate market analysis as needed

You need to continuously monitor the real estate market to know when to invest in real estate. Additionally, you also need to know if you’re ready to invest in a property on sale on the market.

Are You Ready to Invest?

  • You’re financially stable and can make a down payment on the property between 3% and 20% upfront. The closing costs will range from 2% to 5% of the property’s final sales price. Consider other payments related to the property, such as HOA fees, property taxes, homeowners insurance, etc.
  • You have accumulated enough equity in your current home. You can use your current home’s equity to obtain a home equity line of credit or a home equity loan and then use it to invest in another property. 
  • Learn if the neighborhood is experiencing a buyer’s market or a seller’s market. A buyer’s market is when several properties are on sale, but interested buyers are few. A seller’s market is when fewer properties are on sale, but interested buyers are more. If it’s a buyer’s market, invest in the property, as sellers are likely to sell their home at a lower price. 
  • Invest in real estate during winter, especially near Christmas time, as the competition is less. You can also invest in real estate in spring, as several properties go on sale during this time. If you want to buy a property in spring, ensure you have cash or are pre-approved for a mortgage.

Do You Need Help Finding Lucrative Investment Opportunities in Northern Virginia?

If you do, look us up! Michael Gailliot Homes can go to work in finding properties on sale in the neighborhood of your choice in Northern Virginia. 

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©2019 BRIGHT, All Right Reserved. Information deemed rele but not guaranteed. The data relating to real estate for sale o this website appears in part through the BRIGHT internet Data Exchange program, a voluntary cooperative exchange of property listing data between licensed real estate brokage firms in which Century 21 New Millennium participates, and is provided by BRIGHT through a licensing agreement. Real estate listings held by brokerage firms other than Century 21 New Millennium are marked with the IDX logo and detailed information about each listing includes the name of the listing broker. The information provided by this website is for the personal, non-commercial use of consumers and may not be used for any purpose other than to identify prospective properties consumers may be interested in purchasing. Some properties wich appear for sale on this website may no longer be available becuase they are under contract, have Close or are no longer beingt offered for sale. Some real estate firms do not participate in IDX and thier listings do not appear on this website.Some properties listed with participating firms do not appear on this website at the request of the seller. Data last updated on 2019-06-07.