Why Frederick Real Estate Should Be The First Ingredient in Your Investment Portfolio
One of the unfortunate things that happened in the last housing bubble was that people began to view real estate as an investment akin to stock market investments. Historically, real estate has always had the expectation of a long-term equity builder. The fact that real estate was appreciating 20% a year for several years between 2003 and 2006 was an anomaly. The return to a heathy market will be indicated by an average 3 to 6% apprecation each year.
There are several reasons why real estate is a good long-term investment. These are the top two:
1. People have to live somewhere. If you get a fixed-rate mortgage, your monthly payment stays the same, for 30 years (if you stay there that long) -- while everything else, including rent, goes upward.
2. Borrowers leverage their investment. In this way, real estate is much different than investing in the stock market. If you put $10,000 into the stock market and it earns 10%, you've earned $1,000. If you put $10,000 down on a house and its value increases 10% (in a normal healthy market that would be 2 to 4 years) you've made $10,000.
Here are several reasons that are especially true in a buyer's market like we are in today:
1. When the market recovers, you'll have instant equity. In our market, foreclosures have driven prices lower, a return of the market will mean the prices will return.
2. Affordability is at an all-time high, since the 1970 when the statistics were first kept. Interest rates are at an all-time low. The government is willing to help with the $8000 first-time homebuyer's tax credit.
Contact us for a consultation and personal tour of your favorite Frederick Homes.
_________________________________________________________
The Highland Group
Chris & Karen Highland * 301-831-9947
Turning Point Real Estate – 301-831-8232
email us: isell4u2@msn.com
Text Us: 301-401-5119