Okay, here's the thing. You live in a real estate market that you know is declining right now. You've done your real estate timing research and you've seen that the market indicators are telling you that now is not the time to buy in your market. You won't be seeing appreciation for a while yet.
Does that mean you can't invest in real estate?
Should you just wait the market out?
No. There are still opportunities in declining markets. You just need to modify your real estate investing strategy. When a market is in decline probably the single most important thing to do in real estate investing is not to own property. If you own it, you are going to be stuck watching the value go down. But just because you don't want to own doesn't mean you can't be in the game.
Here are four great choices for real estate investing in declining markets.
1. Wholesaling - flip the deals without ever closing on them. Get a great deal under contract and then flip it to an end buyer. The best way to do this is to assign the contract and take an assignment fee. Your other option is a simultaneous closing. This way you are making a profit without having to hold the property. Very safe.
2. Short Sales - let's face it, the foreclosure rate is higher right now than it has ever been in history. It's higher now than it even was last year or the year before. There are tons of short sale opportunities out there. But to do this safely you'll be best off finding an end buyer BEFORE you have to close on the deal. If you are closing and hoping to make a big profit by reselling you'll end up with a much higher level of risk because you are holding in a declining market.
3. Lease Options - Wendy Patton, the nation's leading trainer on lease options, talks all the time about "control without ownership." That's what lease options are. By doing a sandwich lease option you place yourself in the middle of the deal without having to own the property. If you are in a declining market you need to take into account some depreciation as you set up your deals. If the market declines too much you can always try to renegotiate with the seller. But no matter what because it's an option you aren't obligated to purchase, you aren't obligated to close on the deal.
4. Real Estate Timing - If your market is declining then find another market to invest in that is about to go up. The above 3 options are great ways to invest in declining markets, but they can be a whole lot of work! And you really don't need to invest in your own backyard. Spread your wings and find markets that aren't declining. Buy property in markets that are going up so you don't have to do all of that hard work for each and every deal. This national approach to real estate investing allows you to get out of the highly competitive grind of hustling to find deals in your own market and then hustling to find buyers.See this post at it's original source at http://remarketstats.com/blog/real-estate-investing-in-declining-markets/
