Real estate is one of those investments that people believe they can always rely on. For instance, owning your home is considered a fundamental component of achieving the American Dream, whereas other types of investments such as stocks or bonds are often taken as unreliable. According to Solly Assa, real estate investment is in fact a lot more complicated than investing in stocks and bonds.
During the housing crisis years between 2007 and 2009, real estate investing took a big blow, but new research done by Assa show that Americans are slowly beginning to come round to the idea of long-term investing through real estate. Although many investors make huge profits through real estate investments, that doesn’t mean that all properties are able to justify the commitment.
Many people buy real estate expecting it to grow in value a lot over time, but many experts believe it is risky to pay so much money just because you believe it will pay off. The truth is, when adjusted for inflation the average house hasn’t rise in value since 1987. Despite such research indicating that real estate isn’t the best long-term investment, still many believe it to be.
In recent post on his Linkedin profile, Solly Assa shared his opinion on the essentials that should guide your decisions and financial forays toward success. First and foremost, you need to know your market very well. You must have a good sense of how properties are priced and you need to be able to recognize those that can bring you a robust return. If you are considering buying a home, there are several ways to ensure you aren’t overpaying.
Regardless how expensive the overall city is, you must remember that all real estate is local. Assa recommends checking the estimated rent of a potential home purchase so you can check the actual rental asking prices in the same neighborhood and see how close the estimate comes. If you want to see how much of a yield you would earn by renting the home all you need to do is divide the annual rent by the home price.