In our market buyers are making decisions based on their current needs and their future expectations. Whether it’s an investment property or a primary residence, Real Estate Holdings have consistently been one of the best long term investment strategies for generations.
Right now, buyers typically fall within 4 categories.
Move Up Buyer:
This includes first time home buyers and those that need a little more space than their current home affords. Depending on their situation they may be taking equity that they’ve gained over the last few years and rolling it into another property that better fits their needs. Over the course of a lifetime, some buyers will make these moves several times, taking advantage of appreciation through the years to build themselves a nice equity nest egg.
Sometimes, owners have enjoyed the larger space that they’ve occupied long enough and feel it makes sense to get into something that is smaller and easier to maintain. This is happening a lot right now with the baby boomer generation who may have had large homes when they were raising their families but now they want to have less responsibility in terms of upkeep. They will downsize to something that allows them to free up time or equity that they may have generated in their previous property.
A significant portion of transactions in any given market take place simply because the current owner of the property is moving out of the area. While renting a home you own is always an option, many times owners would prefer not to rent the home they once lived in. This in-and-out trend occurs often in Metropolitan markets where there is a concentration of medium to large sized employers that have people moving in and out frequently.
Many times property owners will see the benefits of owning their own home and they will move to the next stage and buy an investment property. Investment properties can offer passive income with an opportunity for appreciation over time. Like any investment, Real Estate has it’s own risk/reward analysis that should be reviewed before making a purchase.