Purchasers are often concerned about home prices…is it the right time to buy….will the value go down, will it not gain as much as they had hoped…what about resale…etc.
Understandably, people do not want to throw money away or invest it unwisely, especially after what our economy has seen; however, a primary residence shouldn’t be considered only for it’s investment potential because often what you would consider a great “investment property” isn’t necessarily where you want to live or doesn’t necessarily meet all of your needs. With those two interests competing, you will have a very difficult time selecting a home.
If you wanna buy a house strictly as an investment, your considerations are much different and much less emotional, it is about the bottom line. If you want to purchase a home to live in, make memories in and it be in a place where you want to be, your considerations will naturally be different.
While it is often the largest purchase most individuals will ever make, and it is no doubt a great investment to purchase real estate; it is a LONG TERM investment…that if kept long enough has historically yielded a return much larger than any other type of investment. If you are buying a home only because you expect a certain percentage increase over a short amount of time, you may be disappointed. It is an average percentage over periods of time that we look at…which means that some years will be less and some years will be more…some years will be flat. Overall though, real estate appreciates…there will always be demand for it, because the population grows and we have a finite amount of land.
The key to being comfortable with your investment is to consider the intangibles…growing your family there, making it a home, making lasting memories and friendships, pride of ownership as well as the tangibles, paying in to something that will help you build long term wealth through long term equity build up and appreciation, provide tax advantages, provide a consistent monthly payment (as opposed to rent which steadily increases yet provides no payoff). What other investment can you actually enjoy while you are investing money in it? You get something out of it while you are putting money in! At the end of the day…if it isn’t an “investment property” you are purchasing, it is a home that also happens to be an investment in your future.
This is not to say that you should make frivolous decisions, pay way over market value or ignore serious defects, consistent declines in a particular area or problems that could affect selling in the future, I just mean that it is a home first and an investment second.
Just my two cents…