The 4 Cycles to Real Estate Investing – A 4 Part Series (Part 2)
(The Cycle 2 Buyers’ Market) Our last post we discussed the 1st cycle. (the cycle 1 Buyers’ Market)
We have uncovered that NOW is always a great time to buy real estate. Seasoned real estate investors always find the opportunities within every market. The important distinction is to understand what makes up a market cycle so we can create clarity as to how to invest within the market. We uncovered the market conditions that help to identify when a market is indeed positioned within a particular market cycle.
So let’s continue onto what I consider the most exciting market cycle, the cycle where millionaires are created. Seriously those who have been purposeful and have taken action and truly capitalized on this cycle (cycle 2 buyers’ market) have become millionaires. It is said that better than 70 percent of millionaires created their wealth within real estate and this cycle represents the cycle that will create the best momentum for growth. Not to be confused with a get rich quick mindset, you have to be diligent and you have to invest (all investments contain an element of risk). Understanding the cycles and investing purposefully where you understand the market position will give you help to position you into safer investments.
The “Cycle 2 Buyers Market”
Distinction of “Cycle 2 Buyers Market”
• Housing supply is being absorbed
• Market time for housing has decreased
• More and more rehabbing occurring
• Rents begin to rise
• Foreclosures are on a decline
• The lower prices have increased sales activity
What is the strategy for buying in this market?
• This is the cycle wealth is created
• Buy as much as you can and keep buying (but be wise and do not over leverage. It is all about safe and sustainable investments.
• Anything that meets your buying criteria should be a safe buy as the markets will go up from here
• Today’s prices are tomorrows bargain so even market prices may be a good investment. Cash flow properties bought now will be a true winner.
• Cash flow will increase from here as prices rise so will rents.
Any city U.S.A. will fall into one of these 4 market cycles. Understanding these cycles is very important to be a purposeful investor. Please also remember that real estate is all about Location, not every market represents the best location. You also want identify the best locations with these buying markets.
Many markets within the U.S. at the time of this post is somewhere within one of these buyers markets. Identifying the best buying markets will position you for the safest and most sustainable investments.
Next post 3. Cycle 3 Sellers’ Market