Mid-Michigan Sees House Market Moving on Up

Mid-Michigan has always been a nice place to live. Unfortunately, the area’s housing market took a hit when the financial crisis hit in 2006, but could the area now be showing signs of recovery?

Recession Hurt the Area

When the financial crisis hit, housing prices plummeted and many people were left upside down on their mortgages. An additional side effect was a true wave of foreclosures, leading to many people losing their once valuable homes.

Demand is Now Up

Now, almost a decade later, the demand for homes is back at an all-time high. Recent trends show that it is not unusual for real estate agents to get multiple bids for the same home. This increase in demand is accredited to the stabilizing financial market.

Supply of Homes is Down

The higher demand for homes is not met though, since there are fewer properties available in the right price range ($100,000-$150,000). Even though there are a considerable amount of expensive homes, the homes that people are looking for are not widely available.

Bidding Wars

Not having enough affordable properties going around has led to intense bidding wars. These bidding wars also have had a direct consequence for the housing prices, causing them to go up dramatically over the past two years.

People are ready to buy again, unfortunately the supply is no longer present. With demand rising, the chance of young couples obtaining a good property is decreasing. However, with the housing market slowly stabilizing, there may be suppliers coming to the scene in the future.

Buy And Hold Strategy Is On The Rise

Every few years, some investors change their strategies to tackle the challenges posed by the real estate market. Of course, some of these strategies regain their popularity again and again in a cyclical manner. In the current economic climate a wise investor should consider revisiting the tried and tested “Buy and Hold” strategy.

A long time ago, before 2002 at least, you could quite easily find property below the market rate. A sensible option in that scenario was to hold onto the property for the long term. You could be certain of a good profit within three to five years. This of course all changed once the market started booming and property prices skyrocketed. No long-term game was viable anymore and investors stopped buying. But the smart ones waited for the right market conditions to return.

Nowadays such conditions might exist once more. You can purchase properties that will bring a ROI between 23 and 25%, ideal for buy and hold.

To make it simple: Buy and hold is little different from buy low and sell high. If you want to use this strategy, you need to be aware of the long-term changes in the real estate market. Keeping track of supply and demand is essential in order to buy property just before others realize that values are low. Similarly you will need to sell property when the supply market is stretched and prices are at their high.

Having sailed through the recent financial crisis, the market is picking up slowly. This may be just the right time for you to try the Buy and Hold strategy and enter the real estate market.

The Recovery of Residential Real Estate

Over the past several years, it has become evident that the residential real estate market is going through a recovery. Along with this, the number of unemployed workers has declined and interest rates have remained low. Obviously, the recovery of the real estate market is outstanding, but it is also uneven.

In other words, residential real estate in certain states is going exceptionally well, whereas in other regions, things are much slower. For states like Florida, Illinois, Michigan, Missouri, and Nevada, the market is moving in a positive direction. However, this causes certain concerns specific to the low inventory of existing homes, stiff competition among homebuyers, and longer wait times for new home construction.

Slowing in 2015

Even though the residential real estate market as a whole has stabilized and even grown in certain states, the housing market has begun to slow this year. Just in the past few months, the number of pending home sales is down. Part of this has to do with weather, but an increase in mortgage rates and a 12 percent jump in home prices are also to blame.

Prior to the recent market crash, we saw the biggest financial and residential real estate bubble, followed by the longest recovery period since the Great Depression. Fueled by easier financing, housing prices topped out by 2007. Then, the market completely crashed, taking almost six years to get into a healthy recovery mode.

Based on what people experienced, the buyer’s mentality completely changed. As a result, a large number of people began renting as opposed to buying, which caused a shift in the housing market.

The recent market crash is still very fresh in some people’s minds, but instead of worrying, people need to understand the recent residential real estate slowdown.

  • Fewer short sales and foreclosures
  • Historical slowing for a few months after residential real estate recovery
  • Slowing of bank and mortgage company failures

Overall, the residential real estate market remains in good shape with homes being affordable throughout the country.

Things to Keep In Mind While Setting Real Estate Investment Goals

Real estate is a fast paced industry and there is no doubt about it. As an investor, you will do whatever is required in order to make quick decisions. Additionally, you will need to act quickly when an opportunity presents itself. You will have the make the best of what you have got to take advantage of property deals. You will come across a lot of investors who invest in fixer uppers; they have such properties repaired and then sell them within a few weeks. But you have to keep in mind that despite all the time pressures, you will still need to set goals. Establishing a strategic plan beforehand will save you from a lot of problems later on.

-General Strategies

Before you make any decision whatsoever, it is important for you to do your homework beforehand. You will need to find out everything there is to know about real estate properties in the area. There is no harm in looking for profiles offering real estate properties and gathering as much information as you possibly can to aid your cause.

Depending on where you are planning to invest, you should consider studying public property records. This gives you all the information you need about the property including recent sales and purchases. Any and all information gathered can then be used to talk to the concerned parties. Additionally, you will also learn about emerging markets, concerns and trends, thus ensuring you make an effective decision while investing in a real estate property.

-Real Estate Relationship Goals

Being a real estate investor is not as easy as it may seem, to better your chances for success you will need to identify those individuals and parties that can actually help you achieve your goals.

Before you go any further, it would be wise to know what your goals are in the first place. For each party and individual, you will need to know what you are hoping to achieve from them. Whether you want to develop a relationship with brokers or lenders, it is necessary for you to be clear about what you want.

To better your chances for success, you can also consider creating a short term plan. The plan will give you everything you will need including the potential clients you need to meet to get the results you require.

-Profitability

Making a good real estate investment is not going to be enough. You will at the same time have to make sure it is profitable at the same time. Depending on the number of properties you are planning to invest in, it would be a good idea to estimate the average potential profits every year. Enough emphasis cannot be placed on the fact that research is vital for your success.

Keeping the aforementioned factors in mind, you have some of the tools to start investing in real estate properties. Even though it may seem complicated at first, setting real estate investment goals will make your job easier than it could have ever been before.

What is the Buy and Hold Strategy in Real Estate?

If you’re interested in real estate, then you may be interested in learning a bit about the buy and hold strategy. This strategy is essentially a long term investment strategy whereby an investor buys and holds a property for a time being. This form of investment is best when a market is developing and it may continue improving for a number of years.

This strategy has been around for a very long time and has oftentimes been the strategy used by the richest people in history. To invest in this, you will have to buy and hold a certain type of property. Instead of buying land, developing it, and then reselling it, you will only need to buy it and wait for its price to increase and then make a decision of whether to sell or not. Furthermore, while you wait for the land value to increase, you always have the option to rent the land out.

How to utilize the strategy

Always ensure that the market will develop. The first step in utilizing this strategy is determining whether you really want to buy and hold. Are you really ready to take such a risk? In real estate your gain is the difference between the purchase cost and the selling cost, so you want to do your research when it comes to the area you are thinking of purchasing. Ask around. Also, you have to be patient and willing to wait a while for the value to increase.

Find suitable property and buy. You will have to look for solid property to invest in. You should consider some elements like proximity to a school, general location within the larger community, and the immediate neighborhood. Finding a property in excellent condition can be beneficial. However, you do have the option to purchase less-then-optimal property and do some clean up and maintenance.

Decide on whether to lease it. Your main goal is to wait for the property’s value to increase and then sell it. However, having a short-term plan is also important. You can gain a monthly income by simply renting the property to a tenant.

Sell the property when its value increases. If your property highly appreciates in value, you should sell it and enjoy the long awaited profit. When selling this property, you may have to use the services of a real estate agent and also list it in newspapers and even online.

The buy and hold strategy works quite well when you do your homework when it comes to location and market. Learn more about this strategy and begin looking for properties that suit your budget and scope. You may just make some excellent money in the long run!

Real estate rehab and its importance

Marketing in real estate is associated with intense competition. All the players of the industry are doing everything within their power to attract buyers and tenants in cases where the real estate is meant for residential accommodation. If you have prospects of selling or leasing real estate, you need to ensure that its attributes are attractive. There are numerous ways in which real estate is improved for purposes of attracting clients. This is often referred to as rehabbing. It does not differ greatly from any form of rehabilitation; however, real estate rehab is primarily concerned with the improvement of real estate for purposes of attracting clients. The following methods are used to improve real estate in a bid to attract clients.

One of the most reliable ways of attracting clients in the real estate industry is through the transformation of the structures that are present on the property. This is aimed at enhancing the elegance of the property based on the demands of a client or on the basis of preconceived client demands. The latter is the most common basis for the transformation of real estate.

Sometimes real estate rehabilitation is based on the demands of targeted clients. In this case, property owners are mainly concerned about the attributes that are able to attract a certain class of clients. For example, some clients may be interested in property that is luxurious. In order to attract such clients, property owners can transform their real estate so that it meets the standards of these prospective clients.

The Pros to Purchasing Real Estate in Florida

Florida is one of the most attractive areas when it comes to residing, especially for those looking to buy or build homes in a warm, sunny climate. Whether you’re a snowbird looking for a warm place to stay or want to relocate permanently, the real estate market is prime right now in making the transition. There are plenty of advantages if you’re considering to venture into real estate in Florida, including:

Warm climate 

If you’re getting tired of the cold winters, you may just want to consider moving to Florida, as the warm weather and the housing market is heating up and everyone is looking at getting a piece of the sunny state for themselves. Both young and old flock to Florida to enjoy relaxing days in the sun.

Revenue from vacation homes

If you purchase a vacation home in Florida, feel free to rent the home out year round so you can enjoy the extra income to help with the house payment. With so many local and foreign people touring the state, it’s rare that you won’t be able to find someone to rent the home.

Florida’s fast economic growth

The rate of Florida’s economic growth is growing very fast and is a magnet for serious investors in the area and abroad. With tourism and a strong economic presence, you cannot go wrong with purchasing real estate in Florida.

Fierce competition

The competition, especially when it comes to vacation homes, is pretty good, so if your new in the game, you have to know what makes clients happy and what makes your competitors tick. The deals and price wars are very real to those venturing in this niche, and so be sure to do your research and hire a reputable real estate agent to help you get through the process.

Go ahead and look into purchasing a home in Florida, as the market is currently pretty strong. Whether you prefer inland or the coast, you’re sure to get great value for your investment.

4 Tips for Effective Goal Setting When Investing

Getting involved in real estate investing is a worthwhile endeavor, as it can be a wonderful means for creating consistent cash flow. With this in mind, it is important to be conscious of short and long-term goals when it comes to your investments and life in general. It’s important to set goals and make consistent steps toward achieving them. If you’re a real estate investor, negotiations and transactions are day-to-day tasks that you may have to contend with, as they help you take steps towards success.

To achieve your objectives, you must devise an effective plan that will assist you in reaching that particular short or long-term goal. Without a plan, you’re like a sailboat without a sail, so here are 4 tips for effective goal setting when investing in real estate:

  1. Set realistic goals
    Setting unrealistic goals is worse than not setting any goals at all, because it sets you up for failure. Go through your goals carefully and replace the unrealistic objectives with goals that you have a high likelihood of achieving. Set both measurable long and short-term goals. The short-term goals should be the precedent in line to accomplishing the long-term objectives.
  2. Know your limits Setting your goals and objectives means knowing your limits well. Know when you are going too far and when are still within your target. This helps you stay reminded of your duties as an investor. You might also want to run your goals by a seasoned investor to get his or her input.
  3. Set specific goals        The goals you set should be clearly defined and specific. At the beginning of every year, most people resolve to go to the gym more, lose more weight or save money in the New Year. But by the end of the February the same people find it difficult to measure how much they have achieved because their targets were too vague and they lost drive. A more effective target would have been to lose 5 to 10 pounds in January, spend at least 30 minutes doing cardio at the gym at least 3 times every week or to save 10 percent of their net pay every payday. Defined goals are important because they help you measure progress.
  4. Know the main purpose of your goals          Knowing why you are setting the goals helps you stay motivated to achieve them. This helps motivate you to work closely on your objectives and view them as your stepping stone towards success. Make sure you know the reason why you’re setting your sights on a certain goal. The stronger or more passionate the reason, the better chance you have of achieving it.

Setting goals is very important. If you talk to successful business men and women, most will tell you that setting goals and creating an action plan to achieve them has helped them achieve the level of success they have. If you haven’t done this, go ahead and devote some time toward doing so.

Of course there is bound to be a failure in some steps that you make towards achieving your goals but learning from those failures and mistakes should help strengthen your resolve to do better than before and help you become wiser when it comes to decision making.

Real Estate Markets in Florida, Illinois, Michigan, Missouri, and Nevada

For many real estate markets, including Florida, Illinois, Michigan, Missouri, and Nevada, recovery after the crash is going well. Interest rates are stable and home prices are on the rise. Right now, there are many good things going on with the market in addition to unemployment inching down.

There is no question that in the states mentioned, it is definitely a buyer’s market. That does not discount rental opportunities but shows that this could in fact be a good time for you to become a homeowner. In the past five years, the biggest price increase for real estate was seen. Considering the housing market was going through a meltdown just prior to that time, a stronger economy is evident. While things are going in the right direction, there are still important factors to consider before buying real estate.

Factors to Consider

With the market looking strong, some people are jumping in without first analyzing some key factors. If you want to build financial security, remember that the economy is still in a recovery phase. Although analysts feel strongly that the market will continue in its current direction, you still need to be somewhat cautious.

While the real estate market has finally turned the corner, the volume of home sales is where it was in 1999. In the meantime, inflation-adjusted prices are at 2000-to-2001 levels. Even construction is currently up, with a significant increase in the number of building permits issued. While this is all great news, current numbers are still not even close to recent highs.

Something else to consider is that while the real estate market for Florida, Illinois, Michigan, Missouri, and Nevada is doing well, other parts of the country are lagging behind. If you plan to purchase a home in one of these states, you may face challenges of low inventory and high competition.