Today we’re talking about why today is the best time to invest in real estate. Let’s get it started.
So, guys, I was once told this: “The best time to buy a house is now, and the best time to sell is never.”
I tell all our investors pretty much the same thing. But what you have to understand is that if a property is not performing well for whatever reason, and sometimes we get that rotten egg property, then you should consider selling out of that asset.
After being in the industry for a while and doing thousands of deals, I have seen investment properties just not perform. Even though it’s the same type of property in the same area and we’ve done everything the same that we always have, for whatever reason that property just does not perform. My advice is to always liquidate and potentially invest the funds in another asset where you might get a better return.
Real Estate Is Typically a Pretty Safe Investment
If you look at the long-term historical trend of the stock market and real estate prices, they always end up going north. And they always end up going up in value. So I think it’s a pretty safe bet, especially with a brick and mortar asset like a house. People will always need a roof over their heads wherever you’re going to be buying these investment properties.
And in the long run, they eventually will go up in value because of inflation and more demand.
Related: 27 Ways to Find Real Estate Deals
Now, the caveat to that is when you buy a property, you don’t want to buy at a high price. The number one rule of investing is buy low and sell high.
There are a lot of folks on the East Coast and West Coast of the U.S. where, in my opinion, right now the property prices are just not affordable. And if you invest in such assets, you could get into a lot of trouble.
What Is Your End Goal?
I think it’s very important that every property that you buy is getting you closer to achieving your end goal. So my question to you is: “What is your end goal with real estate investing?”
As in, how much passive income do you want to generate every month to live the life that you want to live and support your loved ones. Then, you work backward from that number.
So if you want $10,000 in passive income per month or $120,000 per year, then every property that you buy to add to your portfolio has to get you a step closer to achieving your goal.
In essence, there wouldn’t be any point in buying properties anywhere that do not get you closer to achieving your end goal. This would be buying in a market where the prices are too high, the income too low, and the expenses are too high—there is no return on investment. In that instance, there is no point in buying that property.
Deal Are Out There—Now and Always
Now the world is a big place, and there is always going to be an opportunity somewhere, somehow. I say that because I own properties in the Bahamas, Europe, Japan, and the U.S. I’ve bought a lot of properties all over the world, and there is always a deal to be had.
Going back to what I originally said, the best time to buy is now and the best time to sell is never. Sometimes you’re not going to find the deals that you want in your backyard. But if you have the knowledge and the courage to expand statewide, nationwide, and worldwide—to hunt for the deals—you’ll find what you want and need. Once again, we’re talking about passive income and the income you need to live the life you want to live.
Do not count on or exclusively invest for any capital appreciation, because in my opinion, that’s speculative. We can’t predict the future.
Look, where one door closes, another door opens. There may not be a deal in your market, but there’s always a great opportunity out there to be had. It’s just going to come down to your confidence level and courage of wanting to buy out of state or out of the country.
Where are you investing? Why?
I’d love to hear from you in a comment below.
Note By BiggerPockets: These are opinions written by the author and do not necessarily represent the opinions of BiggerPockets.