Are you looking to add to your real estate portfolio? While it might not seem like the right time to purchase property with interest rates so high and economic uncertainty surrounding us, experienced investors always take notice of opportunities when the market is out of favour.
It’s always seems a lot easier to make a purchase when the market is busy and multiple offers are the norm. In this sort of market buyers tend to drive prices higher.
In an “out of favour market prices tend to be flat or down, buyers are few in numbers and sellers are motivated to negotiate. This is the exact type of market we like to purchase in. Buy when the masses are on the sidelines and you have the opportunity to shop around and look for opportunities.
If you are like many investors who know Vancouver, the prediction is for long term appreciation once the economy stabilizes, interest rates begins to fall and immigration takes hold. We think that a real estate investment today will likely prove to be a great decision when you look back in 5 years. Remember, real estate is not like the stock market with prices going up and down in a matter of weeks and months. Real Estate has always best been played as a long-term investment with a horizon of 5 years and longer.
If you are sitting on cash and want to put some to work now, we see some great opportunities out there. One segment of the market we like are Pre Sales. Think about this, you can make a 5 to 15% deposit on a pre sale property paying the full balance in 2 to 3 years. If you like the location and upside of a particular location for its growth then quite possibly, by placing a deposit now on a property in that location today when it’s time to close the purchase in 2025, you may find the value has already increased well above what you negotiated back in 2023. If it has not appreciated it’s ok, your time horizon is long term. What will it be worth in 2028 and beyond is what you should be asking.
Right now developers are offering tremendous incentives to lure buyers in the doors. Those incentives can be in the form of unit upgrades, interest earned on buyer deposits, a free Tesla , 12 months of no strata fees and so on. Developers are also offering smaller upfront deposits to secure a purchase. When the market was going gangbuster, most developers wanted 20-25% down over a 1-2 year period. The deposits now in many cases have been reduced to 10-20% down. This means as a buyers you are tying up a lot less capital but securing the right to own that property 2-3 years before it’s built.
If you are looking to add to your real estate holdings we have some great ideas on where and what to invest in. Real estate as a long term holding strategy can lead to tremendous retirement nest egg. Let us show you how.