Given the reality of investment growth, real estate overall is one investment you can count on.
Yes, it occasionally has its ups and downs, but otherwise, over time real estate steadily increases in value more so than any other investment with less risk. Of course, the size and type of investment depends on your own personal (and sometimes) professional needs and desires.
For example, if you plan on moving to a community to purchase a home where you plan on staying long term, perhaps even living there long enough to pay off your mortgage, then the positive growth benefits are without question. Let’s do some math:
15 years ago in September of 1999, the median price of a single family home in Santa Clarita was $224,900. Flash forward to September of 2014, and that home’s median price is $490,000. That’s nearly a 118% increase in your investment.
Conversely, if you bought your home in September of 2013, you will already see an increase of nearly 14% in your investment.
As we mentioned at the start however, the real estate industry occasionally does have its ups and downs. Just like any investment, there is an element of risk. For long term residential investors, your risk is minimized as you’ll ultimately see growth in your equity.
But was about property investment for financial gain, or “flips?”
Of course, when we look at investing in property purely for financial gain, that element of risk increases. One way around this is to purchase property to use as rentals, thus setting yourself up for positive cash flow every month. Then after a sizable gain in the marketplace, you can sell the property at a profit.
A more riskier move (Albeit with potential financial rewards as well), is to purchase a home to “flip.” Flipping refers to your buying a home at a certain price, then selling as soon as possible to make a profit before you lay out a whole of of your own money. The idea is to secure financing using as little of your own personal wealth as possible, then sell at a higher price before your mortgage obligations are due. Many professional investors are very successful with this type of investment, but you have to understand the ups and downs of the real estate marketplace, and be willing to take the chance that you may not always win big.
Do you want to know more about getting the most out of your real estate investment? Contact Team Avalos Real Estate and let us show you how we can help you achieve all of your real estate goals!
Team Avalos Real Estate
Keller Williams VIP Properties
25124 Springfield Court, Suite 100
Valencia, CA 91355
Office: (661) 290-3743
Carlos direct: (818) 399-4093
Rose direct: (818) 590-2077