To start with, if you look at the long-term historical trend of real estate prices, they always end up going north, and the value going up. Therefore, despite the current market slow down, real estate remains a safe bet for investors. In addition, people will always need a roof over their heads, thus the guaranteed demand for investors in the residential sector, coupled with increased property value once the economy gets back on track.
Secondly, real estate offers stability that stocks cannot- The sudden toll the pandemic has taken on the stock market just reminds us how volatile it is. And while you may still be behind the stock market or might be looking to take advantage of it, you can’t deny that diversification in more stable investments is the best strategy for any portfolio. Right now, long term rental properties do offer that stability. The performance of the individual stock or bond is completely out of your control. With real estate, an investor can improve, lease, sell, or borrow against the property at any time. In this way, money invested in real estate is more controllable and versatile than stocks or bonds
Thirdly, the recent slowdown in the economy has caused a shift in the market, transitioning it more to a buyer’s market. Sellers that are in a position where they need to transact are offering their property at a discount. Also, many buyers have pulled out of the market, but most listings remain active, creating a temporary oversupply of property in select markets, compared to the compressed demand. That won’t last forever, as demand will reassert itself once the pandemic passes, and meanwhile, most construction projects will have stalled for several months at least. Therefore, this is a good time to buy property because rates are relatively low and sellers are more willing to take the first offer that closes the deal rather than holding out for a higher offer in times of severe uncertainty.
In addition, the real estate market is currently experiencing sluggish growth in property prices, with a stagnation of the same in some submarkets. At current rates, buying a property is a very attractive option for homebuyers, as they could take advantage of the prevailing situation and acquire a lifelong asset at a relatively low purchasing price. Therefore, potential home buyers should abandon the wait-and-see policy, go ahead, and purchase their preferred property as this opportunity won’t last for long.
Finally, in today’s scenario, the market is slow and buyers are few. Therefore, it is a great time to expand your real estate portfolio or rather upgrade to a larger home, as developers are offering easy payment schemes and customized payment plans for customers. Some of the available payment options in the market include;
- Cash Payment- This refers to an all-cash offer made for the payment of a property. This option should be guided by one’s budget, the value of the preferred property and one’s financial muscle,
- Installment Option- This refers to the payment of the purchase price through installments, over an agreed period of time. The buyer takes immediate possession of the property but the developer retains legal title as security until the buyer pays the purchase price in full. The main advantage of this option is that payments can be customized to match the client’s financial situation,
- Mortgage Option- Mortgage is a long-term loan designed to assist in buying a house. The lender requires the borrower to raise a deposit of the property value usually around 10% of the purchase price, while the lender offers the remaining amount at a given interest and is to be repaid within an agreed tenor.
The bottom line is that now is a great time to find favorable property deals. Therefore, potential property owners should take advantage of the current times and invest in real estate. Key to note, they must also conduct thorough market research to ensure they get value for their money, in addition to embarking on due diligence before engaging the parties involved and getting into any contracts.