Tuesday, May 31, 2011

NY Times - Front Page News - House Prices Are Set to Hit Another Low

Today's NY Times front page  headline, click here - Wary of Weak Market, More Decide to Rent.

Now is a great opportunity for people who want to have investment properties as part of their personal investment strategies.  Here is the current situation, home prices are down, interest rates are down, this means it is more affordable to acquire homes.  More people are renting and there is limited amount of new construction and rents are climbing up.  So pick a market which has the best chance of inward migration (pick Austin, not Cleveland) and the best chance of new job growth (pick Dallas not Shreveport) and buy rental property.

I am currently buying in Phoenix, even though the housing market recovery is forecast to take longer than Dallas or Austin.  I am investing for a longer hold and the lower costs of maintenance, insurance and taxes in Phoenix means better cash flow today.  If you are looking for a shorter hold you should look to Austin because of job growth, high immigration and a current housing shortage, these should lead to appreciation before other markets.

It is a balancing act when you decide which market is right for you, but now is the best time since the 1990's to acquire income properties.  For those who are already invested, you will see ONEprop working for you to increase your revenue as leases expire.  As your house gets older you will need extra revenue as items wear out and need to be replaced.
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