Is there a way to know the intrinsic value of a house?
House prices have been going up in several places and investors can't really get in to earn meaningful returns. However, prices could also be going up because of a genuinely strong market like jobs and salary growths.
What metrics should I consider to determine if a market is overpriced or priced appropriately?
What is the reason for buying a rental property? Ask yourself that question first. The answer to that question should help you answer your question.
This is very good question Rahul. I think you can approach it by trying to understand the cap rate prior to covid and post covid era. Obviously, the intrinsic value doesn't increase much but market forces is bringing up the price due to more money supply combined with cheap money in public market, so house is being used now as inflation hedging tools.
Free eBook from BiggerPockets!
Join BiggerPockets and get The Ultimate Beginner's Guide to Real Estate Investing for FREE - read by more than 100,000 people - AND get exclusive real estate investing tips, tricks and techniques delivered straight to your inbox twice weekly!
- Actionable advice for getting started,
- Discover the 10 Most Lucrative Real Estate Niches,
- Learn how to get started with or without money,
- Explore Real-Life Strategies for Building Wealth,
- And a LOT more.
Sign up below to download the eBook for FREE today!
We hate spam just as much as you