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Lot #7 at Serenity. One of 12 large custom lots, flat outstanding view lots adjcent to the new Callippe Golf Course. Most of the lots are over .65 acre. Ready to build your custom home.
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6324 Inspiration Terrace: Sold $1,150,000
The Moxley Team | September 29, 2006
Tagged: callippe, callippe-golf, course-most, custom, flat-outstanding, large-custom, lots, Sold Properties, the-lots, the-new
“I think ill wait until the market picks up.” Obviously a great idea because we never want to buy something and see it lose value the next day. The only problem with this thinking is that we do not know when the market will pick up or even what “pick up” means. Does pick up mean an increase of 5% from values year to year or does it mean prices are increasing 1% month to month? One of my greatest concerns with buyers is that many are thinking about waiting until there is a pick up in the market, but waiting until that magic moment when you purchase a home and the next week see increases in prices every month is not possible. After all we purchase homes for the long term, it’s not about timing the market, it’s time in the market that counts. Here is an example: Renter, waits until the market picks up and sees an increase of values at 5% year to year and does this for 3 years, meanwhile paying $2,535 a month in rent and insurance for a total of $95,835, accounting for a 5% rent increase yearly. In the end having a total net worth of 0.
A buyer on the other hand purchases a $650,000 home with a payment of $3,484 plus a tax benefit of $999 bring payments to $2,484. Add in the 5% increase of property values year to year and you now have a home worth $752,456. Not only did the buyer make money, but year to year comparisons to the renter is also much better. For 3 years you will pay $95,835 in rent and have nothing to show for. A buyer will pay $125,385 subtract $35,978 in tax benefits for a grand total of $89,408. Saving nearly $6,000 in payments while also making 5% in equity which totals $232,456. Even if home values do not increase at 5% yearly (the national average is 6.3% since 1968) you will still be saving money by not paying rent.
Again, it’s not about timing the market, it’s time in the market that will save and make you money.
Since 1968 real estate values have increased 6.3% nationally. Nationally real estate values have never experience a year to year decline in values. Compare it to the stock market which has experienced no less than a dozen year to year declines in the same time period. Where will your investment be more secure? Real estate. Take into account the major reason prices continue to increase; people will always need a place to live and every place everyone lives in is owned by someone. Whether it is owned by your parents, your landlord or the government.
So if you are looking to increase your net worth, real estate is the best place to put your money. In addition you have the benefit of leverage, tax write offs and rental income.
Through our contacts in real estate investing we can help you purchase properties across the nation. They are able to assist you in locating a Realtor, property Management Company and obtaining a loan for your property. They do all the market research on out of area markets and show you the potential population growth which equals property values increasing.
For more information on investing in real estate visit www.MoxleyTeam.com or send us an email at homes@MoxleyTeam.com.
If you have a rental home in the East Bay you probably wont see more than a few percentage points of appreciation this next year. If you sold it and invested (1031 exchange) in lower priced faster appreciating areas, you would not only make more money on your investments, but also diversify your investments through multiple locations across the country, making your investment more secure. More secure because you will not have all your ‘eggs in one basket’ or have your investment tied to one market! Areas will appreciate at different rates 6% in one 12% in another and 5% in another. Overall diversification will protect you and net you more in profits.
Anyone reading the news would think the sky is falling in the housing market, but in many markets that’s definitely not the case.
BusinessWeek.com screened data from the NATIONAL ASSOCIATION OF REALTORS® to identify markets with the highest home-price appreciation during the second quarter. To eliminate markets that were undervalued to begin with, the magazine only considered cities that had a median home price higher than the national average of $227,500.
Nationally, home prices increased 3.7 percent in the second quarter. But these top 10 markets all saw prices climb at least three times faster than that:
For more information on investing in appreciating areas throughout the country, contact us at 925.621.4064 or send an email to homes@MoxleyTeam.com.
This is a follow up to a recent post from Monday.
Timing the market is not a possibility, yet so many people are trying to do it. I became fascinated with the idea that people can actually think they know how to do so. So I wrote an article to the editor of the Pleasanton Weekly on this topic.
Follow the link below to read this recently published article.
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