How Does Real Estate Investing Work?
It’s funny how the economy seems to always be going up and down, right? Well, not really. In fact, it seems that it’s almost always going down, with just a few little blips of improvement along the way. We at Perfect RealEstate Investments (PRI) believe that if you can buy real estate of any kind, do it! Properties always increase in value. You might ask, but how does real estate investing really work, and is that true? Let’s take a look at some of the basics.
The first thing to understand about real estate investing is that there is by definition, only so much land available, God is not making it anymore. After all, the earth is only so big. For that reason a lot of people believe that real estate will always increase in value, and while there is some logic to that, real estate can and does decrease in value at times.
As to how does real estate investing works, there are a lot of similarities with any other type of investment. For example, you will do best when you buy at a low price and sell at a much higher price; generally speaking. The trick is to know where you are on the curve of the real estate market.
You need to invest some time before you invest your money. You should look at the area where you are considering buying real estate. How is the city or neighborhood doing economically; are they in an upswing or a downturn. Investors should recognize the dynamic nature of real estate markets. Nothing is static; change is constantly occurring. Changes not only affect individual properties, but also neighborhoods, communities, and regions. Individual properties, districts, neighborhoods, and entire communities often follow a four-phase life span. What about surrounding properties; what industries drive the local economy; and are there any other factors that could have an impact on real estate prices?
Of course, when going it alone the best you can ever do is make an educated guess or you can work with a commercial real estate investment advisor like PRI. Real estate investing is still investing, and that means there is always some level of risk. In fact the more convinced you are that a certain piece of real estate is a sure thing, the more cautious you should be. There is no sure thing.
That being said, apart from the occasional housing bubble, real estate tends to make a very sound investment. At the very least, you will always have something to show for it. In other words it’s not just a piece of paper representing stock in the company, but rather a physical asset, even a bad piece of real estate always has some value.
Perhaps the right answer to “how does real estate investing work”, is “very well as long as you take the time to consider each purchase before you make it”.
Founded in 2013, Perfect RealEstate Investments is privileged to offer years of commercial real estate investing experience. Never losing sight of the fact that commercial investment properties are a long-term adventure — we stick with you as the years go by, doing everything we can to empower you to be successful.
We’re proud to be members of Columbus REALTORS®, The Ohio Association of Realtors, The National Association of Realtors, The Ohio Business Brokers Association, and The Ohio Commercial Real Estate Exchangers.
As trailblazers with of proactive achievement, our team has the experience to guide you around common challenges and pitfalls while providing investment insights that empower you to make the best decisions for your future. In order to serve you best, we’ve built our knowledge and constantly continue to do so.
Paired with our mastery of commercial real estate investing, our passion for helping our clients make us your ultimate solution. Through the twists and turns of your investing journey, we’ll help you maximize the return on your investment (ROI) and thrive. Get in touch to learn more.