When it comes to investing in real estate, timing is more crucial than anything else. A good deal can become a terrible one if you act before you’re ready and, by waiting too late, you can miss some truly fantastic opportunities. Here, we’re going to look at the ways in which you’re timing is critical, and what signs you should look out for to assure that, yes, now is the time to invest.
The property markets
When to invest also depends on where you’re going to invest. There isn’t just one property market, though all markets can be affected by some major events. Property prices and availability tend to fluctuate from place to place. Areas will develop, leading to big investment potential, while others can lose businesses, leading to stagnation. Keeping up with property news from outlets like CP24 can help you identify upcoming opportunities. It’s a good idea to have some property developers and real estate agents in your network, as well, as they tend to have their ear to the ground on these matters.
The lending environment
It’s not just the housing market that will change. The mortgage market tends to change a lot over time, with lending rules, mortgage rates, and more tending to fluctuate over the years. Mortgage brokers such as Altrua Financial can help you always find the best rates available but it’s worth paying attention to news on changing rates. For instance, if lending restrictions tend to loosen, then mortgage rates tend to increase to make up for the risk that banks have to take.
Your financial readiness
There are some aspects of buying a home that you need to take the time to prepare before you go looking at any mortgage applications. For instance, you need a down payment and at least two months of cash reserves to cover your payments. You should also make sure you’re in a good financial position to pay property taxes, utility costs, HOA fees, and more, and make sure that you’re clear of new credit arrangements for at least six months leading up to the purchase.
The time of year
There are some periods where you can reliably predict certain movements within the housing markets. The most reliable change of all is that winter tends to be the best time to save money when buying a house. There are fewer people out buying homes, meaning the property owners are likely to drop their prices in order to encourage a sale. However, there are also likely to be fewer properties on the market, since most sellers will try to get sales out of the way by the end of summer and not put a property up when they stand to make less for it.
Above are only some of the examples of the ways that timing is crucial to any property investment that you make. Either way, it goes to show that rushing can often lead to disaster. Make sure you’re prepared and know that the time is right before you make such a big investment.