Buying a house is an emotional process that involves a lot of stress. It takes weeks or even months of extensive research before finalizing any property. But it does not stop here. You still have to fill out many forms for a home loan and keep a considerable amount of your savings ready for investing in the right property.
The best way to buy a house and get a good deal is to time your buying process accurately. Particularly for markets like Florida, where the real estate trends, mortgage rates and property inventory vary monthly.
For example, the listing price of residential property was lowest in April 2022 in Florida. The homes were approximately $42,625 cheaper on average during this time. However, considering the market in November 2021, houses had a listing price of $39,387 over the yearly average, making it the most expensive month for buying a real estate property.
During the pandemic, fewer properties were listed, and fewer buyers were available in the market. For example, approximately 67% fewer properties were available in Florida alone in August 2020 compared to the Florida real estate market in August 2019. One big reason for this was the health-related concerns. However, the surveys indicated that buyers’ inability and economic uncertainty were the main reasons for the slack in the real estate market during the pandemic.
The best time to invest in real estate also depends on an individual’s priorities and circumstances. However, if you want a good home deal, you must find an experienced realtor who has expertise in your preferred buying location. An ideal realtor can help you crack the best house that suits your pocket and priorities. They often negotiate the best offer possible so that you get your dream home that matches your preferences.
Should You Invest in Florida’s Housing Market Now?
Investing in real estate is generally considered the safest investment option. Florida’s real estate market has also shown great potential over the past few years. And this trend is expected to continue in the coming years too. By the end of 2022, average real estate prices in Florida are anticipated to grow by 2.0%, making it a preferred state for real estate investments.
However, the real estate market in Florida is highly regionalized. It means some cities are good to invest in while others would not give better returns. So, always research the market and consult your realtor before investing in a property. Some best places to invest in Florida are:
- Melbourne
- Lakeland
- Sarasota
- Tampa
- Fort Myers
Crucial Things to Keep in Mind
Real estate is a great way to invest your money, but only if you do it correctly. You have many options to choose from, including purchasing commercial real estate and flipping houses. Each option has its pros and cons, so it is essential to consider some factors before deciding where to put your money.
Always Plan for Home Insurance
Insurance is another essential part of the real estate investment equation. Even if you think your property is worth enough to cover any potential costs, it is a good idea to invest in home insurance. It can protect you from unexpected expenses by covering expenses in case of an accident or disaster on your property.
Before investing in a policy, it is important to be familiar with how much coverage your home needs. You will want to ensure that it covers all the amenities on your property and other necessities, such as water damage and fire prevention equipment. Ask for a quote for your home insurance from different insurance providers in your location. Compare the quotes and choose the one that provides better benefits, claims settlements and coverage for damages. Also, do some research about the insurance company to find out how good they are with settling claims.
Have a Plan to Cover Unexpected Expenses
A plan to cover unexpected expenses is an integral part of real estate investing. It includes unexpected repairs, capital improvements, tax increases and maintenance costs. If you want to rent out your property, you may also want to consider the issue of vacancies and how they affect your overall cash flow.
If you want to sell your house fast in Tampa at some point in the future, having an eviction plan could save you thousands in legal fees and lost rent during vacancy periods.
Property Location and Valuation
In real estate, the location is everything. It is true for both the buyer and seller and all parties involved in an investment transaction. The value of a property will be affected by its location and can help determine whether or not it is a good investment in the first place. For example:
- If you want to buy a home to live there yourself, you may want to stick with something more affordable. Houses with high crime rates or commute times long tend to lose value.
- If you are buying out of necessity, then it is best if you choose an area that already has enough demand from other investors. This way, there will always be plenty of buyers available when resale time comes around, even if interest rate hikes cause some price decreases.
Know the Housing Market in Your Area
The next step is to familiarize yourself with the housing market in your area. It means that you need to know the current market value of a property and how much it has appreciated or depreciated over time. You should also know how this compares to other properties in the neighborhood, city and state.
It will give you an idea of whether or not it is a good time for you to invest in real estate in this area. It will also give you an idea about whether or not there are any profit opportunities when buying properties at specific price points.
Research Your Neighborhood
The best way to do this is by looking at the crime rates, average income, school district and housing market. You can start by searching for your zip code on Trulia or Zillow and then narrowing down the results based on your desired neighborhood parameters. Once you have a list of homes available in each neighborhood, use real estate websites to look at them in detail.
Know Your Investment Goals
The most crucial step in your journey as a real estate investor is determining your investment goals. For example, do you want to make a profit from the sale of your home? Are you looking for a rental property that will provide income? Or are you hoping that investing in real estate will help build equity and add value to your overall portfolio?
Once you know where you are going, it is time to consider how long you plan to stay there. For example, if one of your primary investment goals is building wealth over time through appreciation, then buying an older house might not be the best fit for this strategy. On the other hand, if having cash flow is more important than increasing appreciation, then buying an older house might be ideal because it could still allow for some upside potential. It can also provide regular cash flows from rent payments to tenants who move into it later.
Conclusion
Florida’s real estate market has bounced back remarkably since 2021 and is witnessing considerable growth in home sales. Realty experts believe that despite the application of hawkish policies that target to increase property prices, Florida will continue to be a profitable market.
However, you must prepare yourself with ideal investment options and locate the best places in Florida to make your real estate investment. Whether you buy a house for resale or plan to rent it, consider hiring an expert real estate agent. A realtor can help you get the best deal within your budget.
