Second homes and investment properties fascinate investors, who turn to Inman’s weekly Property Portfolio email newsletter as well as agents who work with this special class of client. This month, we’ll go deeper on everything from the latest at Airbnb and Vrbo to the changes investors are making to their portfolios in a shifting real estate market.
Smart investors are contrarians — they sell when property values are increasing and buy when they are decreasing. According to Realtor.com, major cities such as Austin, Charleston, Denver, Phoenix and Las Vegas have plunged between 7.9 percent and 10.3 percent since June.
As prices fall across the country, 2023 to 2025 may be the best time in two decades to invest in real estate that creates cashflow now, as well as generating revenue to fund your retirement.
Did you know that over the last 200 years, 90 percent of the world’s millionaires built their fortunes by investing in real estate? As President Franklin Roosevelt observed over 80 years ago:
Real estate cannot be lost or stolen, nor can it be carried away. Purchased with common sense, paid for in full, and managed with reasonable care, it is about the safest investment in the world.
Real estate vs. the stock market
From my perspective, key benefits of owning real estate, as opposed to stocks, include:
- Real estate is a hard asset that you can live in or rent.
- Virtually all U.S. real estate has historically kept pace with and/or exceeded the rate of inflation.
- You build equity as prices increase, paying down your mortgage each month, and/or making improvements to the property.
- Stock trades are conducted by sophisticated algorithms at the nano-second level that can result in massive gains or losses in just a few minutes. In comparison, real estate moves at a snail’s pace roughly cycling through seller’s and buyer’s markets about every 10 years. These long-term cycles make it much easier to capitalize on market shifts.
- In the four…