The holidays are upon us, and the spirit has moved me to adapt a familiar Christmas tune to share some tips on ways investor clients can and should benefit from the current shifting real estate market.
- On the first day of a shifting market, savvy investors invest in hybrid cities, which have the accessibility of small-town living with the digital capabilities to work in the global economy. Cities such as Ellijay, Kennesaw, Macon and Savannah are offering decent cash flow and stable prices.
- On the second day of a shifting market, savvy investors negotiate with sellers. Know the market, and be aggressive with your terms.
- On the third day of a shifting market, savvy investors purchase multifamily housing to live in and rent. This is my favorite house hack. Purchase a duplex, triplex or any multifamily property of up to four units with an Federal Housing Administration loan. You can live in one of the units, collect rent on the other(s) and still make only a 3.5% down payment on the loan. This is a no-brainer!
- On the fourth day of a shifting market, savvy investors buy new construction. Yes, you can build it to rent it. Builders with existing inventory need to pay taxes, and, as the year ends, they are ready to make a deal.
- On the fifth day of a shifting market, savvy investors take advantage of creative financing. One example is “subject to,” which is a little-known approach where the buyer can take over the existing financing.
- On the sixth day of a shifting market, savvy investors get a home equity line of credit. This is a great time to cash out the equity in your home and jump into the market.
The key to understanding how to benefit from a shifting market is to know that national news is not always relevant to your local real estate market. Some areas are trending toward complete buyers’ markets and some toward sellers’ markets, but the trends in your individual market are what’s important. It’s vital to know the following key factors: days on the market, inventory available and absorption rate. Understanding this information will help you decide what to do next and help you act fast when you are ready to jump into the market.
Wishing you and yours a safe and blessed holiday season!
– Joannie Bates is a Realtor for Keller Williams Signature Partners. She works with clients in the surrounding area, with a focus on luxury and investment properties.