the Wealthy Canadian

As previously discussed, you must define you real estate investment goals in order to find the right investing situation for you. Once you know why you’re entering the game, you should develop a strategy of achieving that goal. So here are some how-to tips to allow you to realize your particular real estate investment dreams while in a depressed market.

If you intend on buying a family home, then a depressed housing market offers you a better opportunity of negotiation. However, it also requires a modicum of careful research before you sign on the dotted line.

“Location, location, location!” is something you will always hear, but what does it really mean? Of course you’re looking for a home that will visually suit you for years to come, but even a beautiful property placed in an area that shows no real signs of growth will not give you the return you deserve when the kids leave home and you opt to sell. Consider the neighborhood in forms of services and utilities. Will your property continue to enjoy civic support in such things as roads, schools and public transportation? Sometimes prefab sub-developments stagnate and never some to fruition. It would be good to examine whether your neighborhood is able to achieve maturity. You can do this by checking the track record of the developer and the success of their projects. Also look into what the municipality is offering and what they intend to offer in the future. Without this solid backing, you may find yourself locked into a mortgage that no one else will want to assume.

Examine your mortgage options. If you are in the middle of a depressed market that looks like its going to drop further, you may want to opt for a fixed rate mortgage so that as interest rates rise, your rate will remain the same. If you think you see light at the end of the financial tunnel, you may want to consider a variable rate mortgage to take advantage of possible future falling interest rates.

This is just a sample of home ownership as a real estate investment. In our next article we will examine the buy, improve and flip concept.