Hi, it’s Min
Pretty excited to write my first post in here– and I think it’s only appropriate to share with you some tricks and tips on when to buy real estate. I stumbled upon this New York Times article that I thought I’d cover more ground on. Real estate is something that is always good to invest in. Sure the selling/buying prices fluctuate every now and then but there is always a demand for it. As the real estate bigwigs put it, as long as we keep having babies and adding up to the population, someone will always need a place to live in. Timing in real estate is universal– whether you live in Detroit, or in Asia (South Korea!) — you have to know when’s the best time to attack.
Buying real estate property is more a question of when, not why. When is it the best time to buy real estate property? The key to knowing this is by first understanding the Property Market Cycle. This is the more elaborate (quite easy to understand if you ask me) trend of supply and demand in the real estate property world.
So here’s a very simple almost-nutshell explanation of the property market cycle.
The Property Market Cycle
There comes a time when properties start selling at low prices. The prices are so low that the buyers flock the market to get their hands on them. This is called the buyers’ market because the market works at the advantage of the buyers. While the demand is rising, the sellers will slowly adjust the prices higher bit by bit. Imagine a weighing scale where the buyers are on one side and the price is on the other. The more buyers there are, the higher the price goes. This is leading to the phase called sellers’ market, and for very apparent reasons it is called such.
The prices get so high that the buyers think it’s getting ridiculously high they stop buying. This is a common scenario in the Asian real estate market, especially in Malaysia (just see the plethora of reviews at PropertyReviews.my site). The sellers will try to keep the prices up for some time, to see if someone would still take the bait. Many acknowledge this trend, and there are instances where no one budges – sellers won’t sell at a lower price, and buyers won’t move a penny for an investment because of the ridiculously high prices. This is called a stalemate.So much property– but when is the best time to buy?
Because of the low sales, the sellers will eventually start readjusting the prices lower and lower and lower until it becomes attractive enough again for buyers.
When to Buy
The buyers’ market phase is what we have to look out for. And knowing the telltale signs that it is coming is the most vital part. Check for when the sales are going low and the prices are getting high. The prices are bound to go low after some time. Sometimes, the stalemate goes on for a bit too long that when the sellers finally decide to give in, the price drops really low.
Watch out for when the sales are low and start to pick up pace again. This is the best time to buy.
But that does not mean you jump right in and buy! Unless you are moneyed well enough to pay for it in cash, you may want to first look for the best loan offers to back your investment up. Otherwise, a high interest rate on loans would put to waste the great deal you got on the property.
Other Indicators of a Good Market
It would also be helpful if you keep yourself updated on the movements in the stock market. It also greatly affects the movements in the prices of the real estate industry.
Just bear in mind that when it comes to buying real estate investments, timing is everything. Oh, maybe some bargaining skills too.
Do you have any other tips you’d like to share when it comes to buying real estate? Share it with us by emailing email@example.com. Who knows– you might see your story on the next post!