Some Current Thoughts on Property Investment

My attention was drawn earlier this week to a very interesting comment by Lawrence Yun, Chief Economist of the National Association of REALTORS® and I thought I would share it with you.

“Though there will always be discussion about whether to buy or rent, or whether the stock market offers a bigger return than real estate, the reality is that homeowners steadily build wealth. The simplest math shouldn’t be overlooked.”

The statement caused me to pause and consider just how incredibly well property has performed as an investment during my almost a quarter of a century in real estate.

Homes continue to rise in value and you may recall a blog I wrote towards the end of last year when I noted that, along with Washington, California had seen the joint highest equity growth nationally between June 2015 and June 2016, with an average gain of $29,000 over those 12 months.

It therefore seems entirely logical that, in 2017, investment property remains a fantastic option.

As the Lawrence Yun statement suggests, some will maintain that stock markets offer a bigger return, and indeed we've seen some big gains during the rally in markets since November's election. However, let's not forget the turmoil that global markets were in for most of last year. During all that time, property has continued to gain in value. Consistency of return is, of course, something that real estate has been better at than just about any other investment, over the years.

Right now we're in a period of considerable political policy changes and, while time will tell how those play out in terms of their positive/neutral/negative effects on markets, and indeed real estate, let's not forget that property investment has always been very resilient when it comes to changes of government. It's such a well proven method and a great choice while you sit back and wait for the effects of new policies to manifest themselves.

Lawrence Yun also mentions the buy/rent equation and, while first timers have made a very welcome return in recent times, the simple fact is that the rental sector is booming due to very high demand that expert predictions suggest will continue long into the future, with rising rents too. This is a fantastic environment if you're considering property investment as a way of generating passive income.

The other super thing about buying additional property is the extra lifestyle options it affords you. You can have multiple homes that suit activities around the year, as you watch your equity grow.

We have huge experience in helping our clients develop a property investment portfolio, so why not contact us today and share your goals with us and benefit from our knowledge.

Dominic Nicoli