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Americans Prefer to Invest in Real Estate Again!

August 12, 2015
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GoldCoinRealEstateWith more homes selling again, and prices rising while interest rates remain historically low, there is a new resurgence in the preference to invest in real estate for Americans. According to a survey conducted by Bankrate.com on long term investments, 27% of the participants said that the best investment for their money would be property. This is great news for anyone ready to sell their home. For the last three years real estate as an investment has taken a back seat to cash, bonds, or the stock market. For the last two years cash was at the top of the list. So what exactly has happened to help turn the minds of investors once again?

There are several factors and trends at play. One that has seen a large increase in activity is House Flipping. More savvy investors are seeing the benefit of buying a home in need of some work, upgrading the property, and then selling it for a profit. This trend was built on the high rate of foreclosed homes that were on the market. While the number of foreclosed listings has lessened, the desire to turn a house for profit has not. Flipping homes can offer another way to invest savings, to diversify one’s financial portfolio, and more people are finding this idea appealing. Rising value is another factor. The latest measurement of national home prices done by S&P/Case-Shiller reported a 26.8% gain in values since February 2012.

There is also greater peace of mind when you invest in a home. Stocks and bonds can fluctuate widely, and money can suddenly be lost. With real estate, even when the market goes down, the long-term sustainability of property allows for a greater chance to get a higher return when you decide to sell. This is reflected in the Composite Home Price Index, a report put together by S&P/Case-Shiller. The index uses data from 20 major metropolitan cities to measure the value of residential real estate each year. As of June, the index shows a 9.2% annualized return for property bought over the last three years. The S&P 500 index for the U.S. stock market reports a 14.8% return on investments over the last three years, but only a 5.87% return over the last decade, showing a wider variant in returns over time.

A home is an investment worth the time, effort, and money you put into it. When you are ready to sell or buy a home, myself and my team are ready to help you through the entire process. We make the business of real estate a pleasure for you to experience. Contact us today at (925) 634-7820, or by email at realestate@cecily.com.

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