Jan. 2, 2008 - Why Do You Want To Buy Real Estate?

2007 has been successfully put to bed and in the Real Estate world 2008 is still bloated and sluggish. Locally 312 listings expired (meaning they did not sell during the contract period). It still leaves us with over 2400 listings on the market. That is double what inventory levels were on average from 2000-2005. Land listings are even more out of whack with over 3500 lots or parcels for sale in the area.

 What does all this mean for you?

Well, it depends on who you are.

Flipper aka short term investor

If you got in on the buy and flip mania that ended in 2005 and look at real estate as a liquid asset then you are done. Your day has past. That includes those who were third party investors and those living in the home but looking to unload in 2 years with a 100% profit.

Homeowner

You bought your house because you needed a place to live; you liked the area and neighborhood. You are going to do okay even if you bought in ’05, if you are able to stay in your house for a few more years. If you bought 5 or more years ago and need to sell stop trying to make a killing and just make a decent profit. Once your house is sold you are going to have a great choice in your next purchase.

First time buyer

You are holding all the cards. If you have good credit and stable income with some money down you can find  great deals to get you into a home that was beyond your ability just 2 years ago.

Wealth building long term investor

You have hit the jackpot. There are and will continue to be great opportunities to actually purchase properties with positive cash flow and long term growth potential. This is the time that the rich get richer and the simple facts are that real long term wealth is achieved through real estate holdings.

So not only are the markets local but the reasons for buying are personal. Real Estate is a buy and hold investment opportunity that will bring wealth to those who can play the game. Just as with any investment strategy you have to understand your tolerance for risk and ability to ride through blips in market conditions. Then you can decide what category you fall into. One thing is for sure if you are serious about passive income and building long term wealth real estate should be part of your plan.

Vicki Brannock is a Realtor in Prescott Arizona.
email: Vicki@Prescott-RE.com