Real estate has historically been a solid way to build equity, but a downturn in the economy has diminished home values and made it more difficult for prospective buyers to obtain financing without a significant downpayment. However, if you are willing to do your research and take the time to evaluate your options, it is still possible to make a smart real estate investment.
To understand real estate in a particular area, research crime statistics over time. This will give you an accurate picture of the safety of the neighborhood and whether it is likely to become even safer in the future. Additionally, with so many foreclosure homes on the market, those with large sums of cash may want to consider investing in these properties. They can often be purchased at auction for a fraction of their worth and then flipped for a profit or put on the rental market.
Purchasing a home in a manufactured home park may seem like a money-saving idea, but be aware that these parks often carry large fees for new owners and fees for removing the home from the park. It is important to read all materials about the park before making a purchase.
To maximize your chances of getting a wonderful property at an affordable price, consider going house hunting in the fall. This is when there is typically less competition and you may be in a better position to negotiate the price you want. However, don't rush into a purchase. Take at least 24 hours to think it over and ensure it is the right decision for you.
Tour many properties before making your final decision and keep track of which ones you liked and which ones you didn't. You may even want to develop a rating system to help you narrow down your list. Additionally, it is a good idea to have a home inspector go through the property and inspect it to protect your long-term investment.
Finally, if you are looking for a new home builder, you can search online or ask friends and family for recommendations. Additionally, the National Association of Homebuilders can provide referrals.