The rules of real estate investing are rapidly changing. With the rise of the digital era, investors must quickly adapt to new technology and new rules. In 2019, investors must remain flexible and be willing to adopt change in their investment strategies. What worked five years ago may not work today. Here are some tips to help make 2019 a banner year for real estate investors.
Study Real Estate Market Data
Investors should study real estate market data every year, not just in 2019. Data tells a story about neighborhoods and the climate of the housing market. Interest rates, construction costs and neighborhood trends are a short list of data points that investors should carefully study. Real estate apps and the internet make this easier than ever before.
Think of Market Slowdowns as an Opportunity
Many real estate experts suggest the market will experience a cooling trend in 2019. The deals that did not make sense last year or the year before might make sense this year. If rents stay strong and values start to decline, it could present a solid opportunity to invest in multifamily real estate.
Pay Attention to First-Time Homebuyers
With rising interest rates and tight inventories, most homeowners are staying put. However, there is always demand from first-time homebuyers. Experts suggest that flipping starter homes in 2019 could lead to nice profits, while the rest of the housing segment sits on the sidelines until the market stabilizes.
Focus on Equity
Some experts predict that housing prices will start to peak mid-year. If the predictions are true, it could be the right time to extract some equity. Cash in hand gives investors the flexibility they need to secure deals with a proven rate of return. Cash also helps investors transition into other classes of real estate.
Invest In Low-Income Communities
Congress created Opportunity Zones as part of the tax bill in 2017. These zones provide investors with tax breaks and incentives if they invest in distressed communities. Every state in the U.S. has locations designated as Opportunity Zones by Congress, and most real estate websites offer maps of the specific zones.
2019 could be a tricky year for real estate investors. Some experts say interest rates will continue to rise, while others suggest they will fall. What remains a constant in the industry is a sound investment strategy always delivers in any market conditions.