There are a lot of myths and misconceptions about real estate that can confuse investors. That’s in addition to changing trends which can lead to focusing on the wrong deals or not being active enough in the right areas.
Here are some of these factors that you want to be alert to now, and use to guide you in maximizing your potential this year.
Community Isn’t Really That Important
As with micro lofts, and tiny urban condos before, there has recently been a lot of hype about multifamily, and developers building in fabulous community spaces.
According to Pew Research, 69% of those surveyed found the most meaning in their life within their families. Just 16% said they were attached to their local communities.
That may suggest the real estate that is most in demand is going to be single family homes, or multigenerational homes in the suburbs and beyond, rather than tiny spaces in dense urban areas.
Big Flips Are Being Supported By Inflation
We are currently experiencing some of the most fierce inflation in almost 250 years. That’s bad for most people, but is definitely working in favor of real estate investors, flippers and wholesalers.
Rental rates are up 70% in many areas. 30% plus home price appreciation seems very common.
This is enabling investors to make amazing profits. Such as the recent $190M flip by fund billionaire Dan Och, who more than doubled his purchase price of $93M in 2019.
Yes, They Are Making More Real Estate
One of the biggest myths in real estate is that they aren’t making more of it. That’s simply not true.
It is an old saying used to pump up offers on prime real estate. Yet, over the past couple of decades we’ve seen that it is possible to create more land.
Dubai has been building artificial islands for luxury real estate projects for many years. All of the space exploration we’ve been doing is even opening up the potential for real estate deals on other planets. Now, one professor has recommended expanding Manhattan artificially to lower property prices, and for building thousands of new affordable housing units.
Some may be disappointed if they held onto once prime real estate too long under the cloud of this myth. Yet, you can still make uncapped money wholesaling in old and new areas.
TikTok Overtakes Google
Last year TikTok overtook Google as the most popular website in the world, and surpassed Facebook as the most popular social network.
This is likely changing how people get their information, their perceptions and tastes, and more. Consider that when you are evaluating which properties will be in the most demand.
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