Real Estate Investing in 2016: What You Need to Know

Apr 17th 2014

With the economy gradually strengthening in its recovery from the 2008 housing crash, more and more people are confidently investing in real estate again.

The lure of exponential returns has helped real estate quickly regain its popularity among investors, but the same old risks are still there. If you didn’t learn the lesson in 2008, property investing can be a fairly volatile venture. Here are a few suggestions that will help you cope with the inherent risks and maximize your returns in 2016 and beyond.

Find the Hot Spots

The prices and potential returns of real estate in communities across America vary from year to year. As the unique economies in different areas fluctuate, so goes the quality of the local property investment opportunities.

To make a wise investment in 2016, you need to act on information from 2016. Old research may very well be useless today. Dig deep into the most up-to-date data to find the real estate markets that are hot in your target region before investing your money.

Get Your Finances in Order

Getting your finances in order is another step to get out of the way before investing a single dollar. Be honest with yourself about how much you have to spend and the returns you can expect to achieve. In these uncertain times, the last thing you should expect is to have the bank help you out of financial problems.

Run a financial analysis based on your cash flow, net income, cash-on-cash return, cap rate, and total ROI. Taking these measures will lay a strong financial base for you and help guide your efforts.

Invest in a Property Management Firm

Investing in rental income properties can be exceptionally profitable. The sticking point for many investors is that they don’t have the time to attract tenants, fill vacancies, stay on top of repairs, schedule maintenance, and all the other tasks that go into successful property management. That’s where a property management firm can help.

With a reasonably priced rental property, in the right location, with assistance from a property management firm well versed in all the aspects of running your investment efficiently and reliably, you can expect a solid ROI without having to stress yourself with day-to-day details.

Understand the Risks

No matter what type of real estate you invest in, there are going to be some risks involved. Getting your finances in order, doing your homework, and hiring a property management partner will put you on the right track, but there’s no guarantee for success.

Make sure you are keenly aware of the signs of an upcoming downturn that could affect your investment and never get over leveraged. Understanding the risks and preparing yourself are vital to successful ventures into real estate investing.

As the premier property asset management firm serving New York, New Jersey, Delaware, and Pennsylvania, New Vistas Corporation is a great property investment partner for investors throughout the northeast. To learn more about how our assistance can be valuable for any size portfolio, please visit our homepage.

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