Investing Within the Path of Progress
Investing in the path of progress starts with location and doing diligence. There are so many things to consider when investing and location of course is paramount. Identifying the best markets to invest in is something I have long promoted as a necessity to have a nice sustainable investment. So after doing diligence on the best real estate market is it time to buy? Not so fast. You are now in the best real state market and you want to start looking at real estate investment property. You start comparing prices of different properties and you decide to buy because you found a great property in a great market. You first want to ask yourself “Is this property in the path of progress”. Now it is time to put that sustainable investment on steroids. Most markets have a direction of the city where progress is happening, (if not you may not be in an emerging and sustainable market) this path of progress represents the higher demand and therefore the most sustainability, so the path of progress is your target.
Investing in the path of progress
Which direction is the city growing: let’s assume because of land availability and its proximity to highways that the S.W corner of the city is where corporate businesses are building. This means people are driving to this area to work and therefore the commercial retail industry starts putting in gas stations and strip malls to accommodate the traffic in that area. With all the added traffic residential builders know that people like living near their work so they build homes and condos. BOOM the path of progress is now flowing to the S.W.
The S.W corner (in this example) becomes the hot spot and there for property values began to rise at a brisker pace than the rest of the city, soon new schools, office complexes, parks, etc . take position there. Having a portion of the city where everything is new becomes a highly sought after higher demand part of town and supply and demand continues to raise the values there. Rental units can demand higher rents and the investment sustainability is magnified. If this makes sense to you wouldn’t it be great if you could get a clue as to when and where this is happening so you can be one of the earlier buyers of these properties before the prices rise. Well this in not science but there are indicators to watch for.
Reading the tell tail signs of economic growth
• Read the headlines: Such as ground breaking for such and such a company
• New Roads: Headlines that talk about new roads being built. The DOT spends a fortune on economic studies before they build a road, if they are building a new road in an area chances are good the area is about to boom.
• Zoning and planning meetings: attend these and listen to what is being discussed about opening up or building new.
• Talk to commercial builders and see what they have on the upcoming books.
• Read the recent closing section of newspapers: most papers have a section devoted to recent real estate transactions; see what commercial or industry may have just bought land in your target area.
• Talk to waitresses: talking with locals such as a waitresses or taxi drivers will give you a wealth of knowledge as to what an area is doing
• Commercial and residential realtors: Realtors are a great resource. Good realtors who are in the know do all these things and are well informed as to what a city is doing and where the path of progress may be.
Once your diligence tells you that you are in a strong and sustainable real estate investing market and now you have identified the path of progress you have increased the likely hood of having an investment that will give you longer and more sustainable returns.