Interesting question, isn’t it?
The doom mongers (many who missed out on the property boom) say property prices will fall dramatically (and so do most newspaper columnists), yet the property ‘optimists’ say that now is a very good time to start buying.
So who is right?
Everybody has an opinion but what I always say to myself is “look at the person who is giving the opinion and what their motive is.” For example, if someone is selling property, will they say prices are going to fall? And which headline sells more newspapers? Prices to Crash by 30% or Prices to Drop by 3%?
Nobody knows how far property prices will fall (if they do) and how quickly they will recover. The important point is that if your property investment deal stacks up, there is no reason not to buy in the current market for the long term.
In fact, experienced and smart investors are starting to see some GREAT deals coming through now!
The important thing now is to make sure you can answer ‘YES‘ to the following three questions:
1. Are you buying at a *genuine* discount (and avoiding apartments altogether)?
2. Are you generating a positive cash flow? (this is essential)
3. Are you planning to hold on to the property and will not need to sell quickly? (unless you are trading/developing)
If you can answer ‘yes’ to the three questions above, you will not have to worry what happens in the property market in the short-term, as you have purchased for the long term. By sticking to these three golden rules…
1. Your discount will still cushion you from any further property falls (if they happen), thus meaning you avoid negative equity!
2. Your positive cash flow will mean your property is generating you a rental profit – so you are making money from your property from day one!
3. By not selling in the short term you will not lose any money (even if property prices decline)
REMEMBER: Property investment is not about speculating for the short term. If this is what you want to do then you run the risk of getting your fingers burned badly!
But What about Waiting Till Prices Fall by 20% or even 30% plus?
I often hear this question asked by investors.
Like I said earlier, nobody knows if and by how much property prices will fall, so why get into the speculating game?
If you are serious about property investment then you really cannot lose in the long-term!
For example, if you are able to buy a property now with a *genuine* 20% discount and it generates a positive cash flow then why would you not purchase now?
REMEMBER: Property is not like buying a share, where you never know if a stock will recover!
This really is a market for ‘cash rich’ investors who have fast access to money and there are some great deals out there!
I recently sent out an email about our forthcoming Property Insider Deals service that will be aimed at cash rich investors who want ‘hands-off’ heavily discounted deals delivered to them. We have had a fantastic response so far.
If you want the low-down on these insider deals then click the link to learn more about the Property Insider Deals service that will be launched shortly.
