That is exactly my problem...I have no idea how to predict where or when a housing market will shift for better or worse. I know a lot, if not all of it, has to do with jobs in the area. What clues do you look for in a local economy telling you to sale your properties or buy more? I have looked on the states DOL web site, but I can't help but think the info/predictions might be padded by somebody with an interest in the state.
Any thoughts are greatly appreciated!
The key is to get out of the house and meet people. Looking at a state website isn't going to get it done. If you really want to know what's happening in your community, then be active in the community. Join your local REIA. Attend city council meetings. Read your local paper. Meet and make friends with the "players" in your city. That's all part of your job if you're serious about your business.
Having said that, I don't make purchasing decisions on the possibility that the real estate market will change. All of old pros have told me that last year was the worst rental market we've had in our area in 15 years (and it was ugly). I've been buying rentals for the past 3 1/2 years and survived (and made a profit) during this bad time. The key to making it through all cycles of the market is to buy at a BIG discount and insist on a significant cash flow.
Thanks Mike. I agree with what you're saying. My particular problem is I became a landlord by default...twice. It's a couple of long stories...a combination of ignorance and life happening at the same time. I am not looking to buy property in the area where these two homes are located I just don't want to get caught holding the bag if the market drops. I also don't want to sale the homes just yet becasue the market has been appreciating between 8 and 10 percent for the past 4 years, at least. A problem with the area where these homes are located is it has a history of boom and bust. Also, I am not physically in the area and there are no REI clubs there...it's a smaller town.
Let me know what you think. I'm not expecting yout o have the exact answer for me, I'm just thinkg out loud and trying to get different perspectives.
Here is what I look at - it's the only way that makes sense.
Does the property provide a positive cash flow or a negative cash flow. If positive I'll make an offer. If negative I'll pass.
ANY price appreciation is gravy. Look at it that way and you'll rarely get into trouble.
The reason the market is so "bad" right now is that everyone focuses on appreciation.
That's like driving a car by looking out the back window.
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