Thinking of Investing in Northern Virginia Real Estate?

 

Then you and Warren Buffett are in the same boat. Eighteen months ago Buffett told CNBC that he would buy millions of homes if he had a way to manage them. Why? Because he knows that over time real estate will out perform the stock market as an investment vehicle. Over the past 40 years, real estate has suffered negative appreciation in only four years, the worst of which was 2011 when real estate lost 13% of its value on average. During that same 40-year span, the S&P 500 stock index has experienced negative appreciation eleven times, including a 38% drop in 2011.

If you’re worried that real estate investing is game that only the rich can play, think again. In 2011 the median income of real estate investors was $86,100. Fifty-eight percent of these investors made less than $100,000 and 39% made less than $75,000. Fifty-six percent of all investors in 2011 lived in dual income households.

What were they buying? While you might think that most purchased vacation rentals, townhouses or condominiums that was not the case. Fifty-seven percent of the investment properties purchased in 2011 were detached, single-family homes. Three quarters of the properties were in small towns or suburban areas. Only 8% were resort properties.

As with any investment, investing in real estate requires knowledge of the market and a strong investment plan. Every investment property should be purchased with a specific goal in mind. The plan must fit whatever goals you have for the investment whether it’s paying for a child’s college education, building a retirement next egg, or generating cash-flow to help with current expenses.

If you would like to sit down and discuss how you can make money in real estate, we’re here to help with the analytical tools to insure that the properties you buy make sound economic sense based upon the goals you have.

 

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