By now you must know I’m optimistic about real estate in general. I think the next two years will be very good, but I base that on real estate as an investment, not a get rich quick scheme.
There are lots of news reports telling us we’re sitting on a doldrums market and people can’t afford to live in certain areas. I’m not debating that. But I still say real estate is a local market. All you really need to be [tag-ice investments ]concerned[/tag-ice] with are your farming communities. In other words, know what’s happening in the neighborhoods where your properties (your farms) are located.
However, my dad who is an [tag-tec real estate ]80[/tag-tec] year old investor and my No. Uno advisor, sees a trend here worth noting. People are being pressed out of certain neighborhoods. This isn’t a racial or social problem. It’s purely economic. Rising costs are forcing people out.
What does this mean? There will be more tenants, more rentals. That can be good for us with the right planning and knowledge, especially those of us who are buy and hold investors.
Here’s an interesting parallel. Car leasing. Why do people lease cars? Probably for the same reasons they lease housing. They want something nicer than they can afford to buy. Sure, conveninece is very important, but there is the underlining human desire to get more. They can get it for a price but the price is for temporary usage.
That’s okay with some people. Not me. I want the investment. I want something I can feel, walk around, and know it’s a part of my portfolio that’s alive, full of vitality- and tenants. That’s the major difference between a tenant and an owner. Sure ownership comes with some responsibilities, but it’s worth it.