Is Real Estate a Good Investment?

Let me begin by saying thank you for visiting my website to research potential homes. I know there are many other websites you could choose, but unlike the major ones that rely on Realtors to pay for their listings to be posted, this website makes all the listings from the Realtors website available to you free. So don’t hesitate to use it or to ask me for additional information about any particular property.

To simplify the home search process I can email you instantly new listings as they become available so you don’t have to spend time searching the internet everyday; just let us know.

Is it a good time to buy real estate? If you have an income and/or money, then YES!

I’m sure you want to know what is happening in the real estate market and where it is going. The best window to the future is the past: by looking at past trends we can see how to take advantage of the market now to benefit your future.

To start with there is a large inventory of homes on the market (presently about 15,000 in San Diego County). With increased supply, prices have decreased. With a possible recession caused by the economy, lenders have lowered interest rates to encourage buying by borrowing. The past and present Presidents have authorized the Treasury to produce over $1.5 trillion to stimulate the economy. This increased supply of money, like with homes, will decrease the value of the US dollar which, as we have seen in the past, will in turn cause inflation. To counter inflation the Federal Reserve will then have to increase the demand for US currency by increasing the interest rates.

What this means for you is that if you have steady income or you are looking to invest your money in something other than the stock market, CDs, and bonds, then real estate is probably the best choice.

If you are an investor, then you know it makes sense to borrow as much money as you can and lock it in at the low interest rates with a fixed 30 or 40 year loan. If interest rates go up you are locked in at the low rate. If inflation starts to kick in, then you can take advantage of the situation by increasing rent while still making low interest payments.

If you are a first time buyer, then it only makes sense to buy in a buyer’s market and with the interest rates low it only makes more sense. On top of all that there is an $8000 tax credit for qualified buyers (see a tax professional for details). I know you want to buy when the real estate market hits bottom, but you should not be just looking at prices; you need to be looking at interest rates too since these will affect you if you plan to get a loan. A 5% decrease in price is more than offset by a 0.5% increase in the interest rate. For example, if you borrowed $100,000 at 5% interest rate on a 30yr fixed loan, your payments will be $536.82. Now if you borrowed $95,000 at 5.5% interest rate on a 30yr fixed loan, your payments will be $539.40.
When you are ready to learn more about the real estate market in San Diego give me a call or shoot me an email. Together we can find the perfect fit for you.

For all Luxury homes for sale in San Diego County visit www.877homes.com