Know When To Make a Real Estate Investment

By Lance Wilson

When you think about the economy and it's constant up and down status, it's funny how the "experts" seem to come out of the woodwork to talk about a real estate investment. While we're all gasping for air and looking for a way out, they seemingly have the answer. Regardless, the economy will continue to do what it will no matter what they predict and cash homes buyers will be hanging on every word.

Earlier this year many housing markets across the country saw a 60% decline in retail values before the summer. Then the typical occurred. The 2nd and 3rd quarters enjoyed a slight gain in some markets while in others at least a slowdown in falling prices. Now some realtors are so bold as to predict a slow steady rise in home values. Yes, they will have us believe that it will be smooth sailing in the housing market from here on in.

So, are they right? Well, when you look at the supply and demand factor it's hard to say yes. See, back in 2007 the spring time saw buyers start to hold back. This was due to the winter months being full of inflated prices, and even though they leveled off, it wasn't pretty. So when cash homes buyers were looking for a real estate investment, they weren't worried about the normal cautionary considerations. It ended up being a sobering time for many, but fast forward and deflation seems to be the trend.

When looking at the purchase rates, you will find that most families decide to move during school summer break. This allows for a much easier transition, and when the market knows this, prices tend to rise.

When there was a greater demand, banks held up the flow of foreclosures that hit the market. Since a sizeable percentage of the foreclosures were held back, you would think the values across the board would fall. This is exactly what happened, and it was something experienced by the entire market. What it came down to is that the supply was lower, and the demand was higher for cash homes buyers.

So what exactly does this mean for the future? Well, once school rolled around, September brought about several foreclosures. Even though things looked great just one month prior, the supply started growing and the demand was falling short. Right now you will find a healthy supply of foreclosures that haven't even been processed. So you can most likely see much of the same until next spring.

Furthermore, the profiles of families in default have evolved from the subprime arena to "A paper" loans to families who could, in fact, stay in their homes but will opt out for financially sound reasons. These are folks who are a bit more sophisticated and may have larger household incomes than the prior group. Many could still make their payments but choose to get out from under the huge debt that the market has dealt them. Many families see a quarter million dollar sink hole (or more) and will choose to short sell the home, wait 2 years and buy the same home for much, much less. Notwithstanding the moral dilemma, many find that it just makes good economic sense.

The foregoing scenario presents some interesting real estate investment opportunities for the cash home buyer. That's why we buy homes all over the United States during these market conditions. While the market trend may not be as favorable for the retail buyer, cash homes buyers in most U.S. markets are making insane profits by skillfully applying the simple principle of "supply and demand. - 23229

About the Author:

Lance Wilson an active Invesdoor Territory Managers and real estate investment expert . Need to Sell Your Home , we Buy Houses for cash fast . We pay cash for homes.