I've said before that I hope to make some money off the housing slowdown. I have no debt and some cash on the sidelines, so if things get bad enough (or good enough, depending on how you look at it) I may buy a property or two -- if I can get a really, really good deal. Then, I'd be willing to sit on it for awhile, selling it a few years down the road for a decent profit (hopefully)
Well, the timing's not right for that -- yet. At least according to this Money piece that says there may be a real estate slowdown, but bargain hunters still aren't finding much to feast on. Their key thoughts:
As signs mount of a slowing real estate market, the "vultures" are beginning to circle. But home prices may still have to fall further to create the bargains they crave.
These savvy home buyers who "save their pennies, wait for bargains and then pounce" are already out and about in Manhattan, according to Leonard Steinberg, an executive vice president with Prudential Douglas Elliman.
I agree that it's way too early in the ball game to start buying. In fact, it's not even pre-determined that the housing market will fall enough to make it worth buying for investment purposes (prices may fall a little, then simply level off). But, there are signs that there may be some opportunity in the future:
Lee says that there could be some bargains soon in some once bubbly markets, such as South Florida. Another market that Lee identifies as ripe for a fall is the condo segment in the District of Columbia and its upscale suburbs. And he's eyeing California's Central Valley cities, including Bakersfield, Stockton and Modesto.
That's on the "pro" side of this "buy at the bottom" idea. The "con" side is:
"Besides," he says, "it's tricky. How do you know if you bought at the bottom? It's timing the market and, short-term, you can get burned."
That's true. Very true. I think the keys are knowledge, information and patience. You need to know your market very well, have the information to find great properties, then be patient enough to get a price that works for you. It's like value investing in stocks (or even Phil Town's idea of buying $1 for 50 cents.) ;-)
For me, there's another motivation besides making money. I wouldn't mind owning some land as well as a place a bit away from civilization. So if I find just the right place at just the right price, I won't mind holding on to it for a long, long time -- maybe forever.
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