Phone Call for a $500k listing sounds exciting right?
Got the phone call! A friend referred a listing to me. Beautiful home, it was in the Parade of Homes. So I sit down and give her the brutal details. There is a 5 year supply on the market in her price range and in her area. 5 YEAR SUPPLY!
Why is there a 5 year supply in some areas and price ranges?
For one, everyone moving to Utah has a house to sell or their house in another state is being foreclosed on. Out of staters cant buy here. They have flooded our rental market though.
Just down the street from this new listing is a family who all took out home owner equity lines of credit and bought about 8 homes during the boom. Yes, 8 homes! They all bought new construction that was twice the median price range in the area. They were hoping to flip it.
Are they the only ones?
No, droves of people have come to me. Its like a tidal wave hit and people out of no where become real estate flippers/speculaters. They all were building homes hoping to make a quick 100k.
Remember the basics to investing. High Return means High Risk. And people were jumping in the ocean like there were no sharks in the water.
The entire state is now feeling the affects of people who risked all for quick money.
Reminder in Real Estate Investing and How Wealth is Created.
If the return is huge....there is high risk. If you can't afford to risk it, don't do it. Investing in real estate means doing it smart. How do you do it smart? Try buying homes in majority owner occupied neighborhoods that are in the median price range. Also, wealth is created either by creating value or by seasoning. Buying a home and hoping to flip it without doing anything in 30 days breaks both the rules on creating wealth.
Good news is you can still sell. You can still increase your odds of selling. You also can find awesome deals.
This is the market to make money. Its when everyone makes like an ostrich and hides their head in a hole thinking everything is bad outside of them.
Coming soon.......Stats on your neighborhood on what the inventory is like. Coming to utahdave.com In the meantime you can search utah homes for sale here.
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