Real estate can be a great investment with unusual appreciation. We have had several years of exceptional annual appreciation. We continue to have great recognition, maybe as much as 20% annually in some areas. But, it is not as extensive or as extensive as it was. Real estate as an investment can be from pretty good to the best in the world, but it is an investment that looks better in the long run; There may be long periods when its value does not increase much, if at all. Taken over a period of decades or even centuries, nothing on earth beats it. Another problem with real estate is that it is not liquid, that is, it is not easy to convert it into cash, like stocks, bonds and savings accounts. Real estate is particularly illiquid during a recession in our markets. You probably won’t hear this anywhere else, especially from other realtors, but real estate isn’t a great investment, it’s usually a good investment, but not always, and not all the time, when looking short. term. Too many people buy real estate as an investment and forget that there are other reasons to buy. I suggest that you will be much happier if you buy real estate for your use and lifestyle rather than as an investment, when it comes to your place of residence or your second home. Perhaps it should be almost exclusively a lifestyle. After all, a primary residence or second home should be a place to enjoy a lifestyle that allows you to relax and disconnect from the rest of life. If you live a very public life, in which people are always looking for you, in which you are always in the light of public scrutiny and often in the press, for example; if your normal life is one in which you must always behave in the best way and always elaborate every word and action to obtain the best possible value. So maybe a private place, away from others, a place where you don’t know your neighbors, is right for you. There are some communities that are unique. There is one just for you! Perhaps the lifestyle you want is in the middle of it all. Take a look at various properties for sale. Each of these properties has its own personality of location and lifestyle. Ask your real estate agent for lifestyle details on any of them. The most important thing is that you visit them on your own and find out from the other residents by meeting and asking questions. Weekends are a great time to walk around the area and talk to those who work outside! One of the things that I try to convey to people in stages of life where lifestyle is really the only reason to buy a home is to think only of “lifestyle.” Are you really trying to buy an investment that will appreciate over a period of time so that you can sell it for a profit in the future? Or are you trying to adjust to a lifestyle that will allow you to enjoy your home and surroundings and other aspects of your life? Perhaps your other investments are in place, you are looking for a retirement life and you want to enjoy the lifestyle of a million dollar house, but you do not want to take that money out of liquid investments, which you may need to access. In such a case, you may want to buy a house on leased land. The landowner will get the appreciation, but you can save, in some cases a million dollars or more, by purchasing a home on leased land. In some cases, it may be a mobile home or manufactured home on rented or leased land. In our southern Delaware area, most people who live in land rental communities DO NOT view the home here as an investment. They have investments. Perhaps your perfect lifestyle home won’t appreciate much or not at all … at least not in the short term. BUT as long as you keep your home in tip-top condition and are in a desirable community, chances are you won’t lose anything at all. If you are considering a community that involves leased land, or “rental land” as some people call it, then consider what else you can get out of the deal. Here and in other areas, some parks or land-rental communities allow you to live life as one of the rich without paying for it and with no time or maintenance costs. You can get benefits such as swimming pools, private beaches, marinas, tennis courts, lawn mowing, garbage collection, daily or hourly security vehicles, etc. The communities that I know that are in “simple rate”, which is where you own your own land, do not provide all these benefits (although I know many that do provide some). Consider what it is you want away from home or away from a vacation home. If low maintenance is a priority for you right now, the manufactured home community may be the best option, perhaps. Also, you need to consider how much you are willing to spend on a vacation home. This will have a major influence on what you will eventually buy. There are many options for people in your situation. You just need to balance your wants and needs in order of priority. Next, consider your finances. There are many desirable factors in owning each different type of residential real estate. All we ask is that for YOUR enhanced happiness, you consider lifestyle rather than just investment appreciation! Copyright 2004 by Jody Hudson
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Real estate: reasons and priorities for buying a property
