As we enter a new decade we should look ahead to see what will come of our real estate as we approach 2030. To do this properly we should look back to 2010 to see what happened in real estate this past decade so we can better predict the future. The first thing out of everyone’s mouth is that if I had bought a property in 2010 I would have made a ton of money already. The biggest problem with this statement is that if you are in the position to buy real estate you would have. I really do not believe anyone who has the ability to buy real estate holds back and just sits on their money. In reality, about 60% of those who wished they bought a decade ago had no way of doing it then, about 20% did have the ability but used the money for something else, and the remainder 20% do not realize they have the ability to buy property or are too scared to take the risk.
Over the years I have often told you to buy real estate now. That is never going to change. What type of real estate, and for how much, will always change but buy real estate now will always be the answer to building wealth. Houses in our city were about 60% cheaper ten years ago. Let that sink in. Sixty percent lower than today’s price and when you only use 5% down to buy a property then you are making ten times your investment for doing nothing but buying a property. Yes there is upkeep, hassles etcetera but the time you put in for your return is nothing in comparison. If I were to take the actual time I spent on my real estate investments per year and divided it by the amount it appreciated, it would work out to something like a thousand dollars an hour or more — every year.
When you look back at 2010 you see low prices compared to today and higher interest rates but remember we were just coming out of a recession and the market was steady but you could still find a deal or diamond in the rough. Now in 2020 the diamonds in the rough are a little harder to find but a deal still can be had. In today’s market your investment would be more into pre build condos or older condos that are being renovated instead of single family or investment properties. There are buyers buying an entire floor of a condo building to achieve higher returns since they will get a ridiculous deal from the builder and by the time it is built the market will have increased enough to not only cover the down payment but make a nice profit times ten. Of course we all cannot afford to buy a floor but we can buy an up and comer or a pre build that will give us a great investment that can keep valuing up for years to come! It is not a matter of when to buy but rather what to buy in 2020.
Darrin DeRoches is a local real estate and mortgage broker. He can be reached to answer questions, comments or stories about real estate experiences through this weekly column at firstname.lastname@example.org.