Now that we are still relatively into the early days of the 2019, what should we, as real estate investors prepare for? Will this be a year of good fortune? Or will investing in real estate this year create more problems and challenges than the year that passed?
Experts are saying that the prices for real estate, especially the residential type will still be a good addition to one’s portfolio but be aware that the number of interested buyers may be waning down. High prices in the market is causing homebuyers to hold on to their money instead of investing it in the market.
Another factor that is causing the market to slow down is the high mortgage rates. For 2018 the rates skyrocketed to its highest for seven years. Although the rates have gone down since last year but real estate experts are saying that it has a high probability of going up by this year and this will make it even more challenging for would-be buyers to let go of their money.
When before those who are selling real estate can demand for prices as there were not a lot of supply in the market but this year it will be a little different. As the price for the home is slowing down, sales will be expected to drop and it may not be as rosy as it was last year.
To get the best value for your money, you need to save up and pay a bigger down payment to help cushion the impact of paying higher mortgage. It is better to prepare for the maximum amount that you can possibly save up for. If you need more time to do it then wait a bit more. Waiting and saving up more is better than just setting your sights on the minimum amount that you can give.
One thing is clear, investing in real estate is still a sound investment but just be aware that it may not be as lucrative as it was in the past year. Being realistic with the expectations is the way to go. List down what your non-negotiables are and identify what you can let go. Research about the neighborhood that you want and be honest with yourself – is this a location that you think is right for you now and in the next 10 or 15 years? Preparation is key, so save up as much as you can.