Real estate investing success isn't based on luck. Sure, sometimes you'll get lucky and find the perfect house at the perfect time, but overall, it's about knowledge, patience, and timing. Investors learned a few things about California real estate last year, and you can certainly learn from them and use that knowledge to your advantage.
Prices Went Up
This is obvious to anyone trying to buy a house in California. Prices reached an extreme high in 2016, making it almost impossible for first time home buyers to land a home in the California area without spending 80% of their income on a mortgage. Because of this, there are fewer buyers looking in the area right now.
There's Less Competition Now
When trying to buy a house in a popular area that's also affordable, you'll find it difficult to get the house you want. There's too many offers being thrown in, too many buyers competing against you. You will lose more often than you win. However, when there aren't many buyers in the market making offers, sellers are going to pay attention when you show interest. This gives you a chance to snag the perfect house, without having to fight tooth and nail to get it. You can look around without feeling rushed and find that perfect house that needs some extra TLC. You have the chance to be patient and drive the price down a little.
Prices Most Likely Will Drop Soon
While there might be a shortage of people scrambling to buy homes right now, it won't be that way for long. Without an influx of buyers driving the market up, it will inevitably come back down. Once that happens, buyers will once again flock to the area looking to buy homes for their family. As the owner of one, or a few, of the houses in the desired area, you'll reap the benefits of this increase in buyers. You might be thinking if the prices come down, won't that be bad for me? The answer is no. You'll reap the rewards as prices dip and buyers flood the market again if you waited until a seller got desperate or you picked your houses strategically, finding homes with massive potential that just needed some improvement and updates. If you didn't pay outrageous prices but instead used patience and timing to your advantage, you'll have set yourself up for a wonderful reward and hefty profit.
As stated before, real estate investment is all about timing, patience, and knowledge. Take advantage of the slow market now so that you can reap the benefits as prices dip and buyers increase, which will happen soon. If you're in the market for a fix and flip project and need financial assistance, please contact us.