10 Reasons to keep Buying property in a Down Market
| | Wednesday, July 11, 2007 @ 08:03 AM EDT
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Contributed by: Jason Popkin
Jason Popkin Properties
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10) More selection – Even when it’s a “buyer’s market,” that doesn’t stop people from selling houses. Deaths, divorces, job transfers and foreclosures don’t slow down just because it’s a buyer’s market. There will inevitably be a glut of houses on the market, and it only benefits prospective buyers.
9) More room to negotiate – A slower pace to the market means more time to walk away and make them sweat. Buyers have the upper hand, not only because there will be fewer prospective buyers to compete with, but also because there will be high inventory.
8) Greater room for appreciation – Even small home improvement projects can mean big returns during selling season. Profits are maximized when you keep overhead costs low by doing the projects yourself and when you score a great deal on your home in the first place by buying when the market is down.
7) Extreme Home Makeover – Bottom line: sellers want to sell. If their home is stalling, they are going to slap some lipstick on that pig. All those little home repairs and improvements they never quite got around to will suddenly be a priority.
6) Seal the deal – Other perks presented by sellers to prospective home buyers may include vacation getaways, cars, or picking up the closing costs. They are that eager to close the deal. Plus, buyers will be more justified in asking for these things.
5) Mortgages – Just as homeowners needing to sell get antsy in a down market, mortgage lenders also get anxious for customers. After all, it is their bread and butter. You will find so much more flexibility and accommodation at the lender’s office when the market is down.
4) You live where? – The inner-city. Some fear it. Some loathe it. Some are smart and buy property in it. Why? The market around inner city areas, particularly where there is government-subsidized housing, is almost guaranteed to be down initially. Seized property is common in these areas and can lead to an especially low ground-floor investment. Such areas are trending toward the renovation of old structures, the infusion of yuppie residents, revitalization of businesses and skyrocketing property values.
3) Green acres – The country. Some fear it. Some loathe it. Some are smart and buy property in it. Rural areas present another scenario where the market will be considerably cheaper than other areas closer to a metropolitan hub. However, there is a trend toward moving farther out, with commuter trains and carpooling becoming popular. Hence, getting in on the ground floor in a market nobody wants to live in at the time can mean big profits when retailers, corporations and yuppies start taking interest in the area.
2) Down payment – The money you saved toward a down payment goes further if costs are reduced due to a down market. Instead of a 20-percent down payment, you may find yourself with a 25- or 30-percent down payment!
1) Taxes – Simply put, there is never a bad time to own a home. The buyer’s market is obviously the best time to buy, but regardless of that, the lure tax benefits and credit record improvement should make you want to own a home yesterday.
Note: Jason Popkin is a Real Estate Investor who has also owned and managed Real Estate Brokerages.
TCI Username: jpopkin
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