| When the real estate market is booming,
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| | For people just starting out in real
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| the price of property gets higher each
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| | estate investing, a down market is the
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| month. Making money in this type of
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| | best time to enter. One great method for
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| market is easy. In fact, you can hardly
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| | buying properties, for someone with
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| avoid making money in a hot real estate
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| | little working capital, is the age-old
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| market. Just buy property at the going
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| | gem known as renting with an option to
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| price with, preferably, a no points
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| | buy.
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| mortgage, hang on for a couple months,
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| | In a hot market, you'll never find such a
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| then put it back on the market and ask 10
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| | deal. It's too easy for the seller to
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| percent more than you paid for it. If
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| | unload his house at a large profit. But
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| there are no offers at first, hang on, in
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| | when the house won't sell, you will find
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| a truly hot market, you'll get your price
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| | people who will do anything to get out
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| in no time.
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| | from underneath its mortgage.
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| This crude form of flipping, along with
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| | Realistically, you will have to look
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| other popular forms of "Getting Rich in
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| | around a bit to find someone who will
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| Real Estate," work as long as the market
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| | rent a house to you and give you an
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| allows it to work. Buying fixer uppers,
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| | option to buy, but look hard enough when
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| rental properties, subdividing, even just
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| | the market is slow, and you'll find such
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| being a common homeowner are all
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| | a seller, for sure.
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| lucrative strategies in a booming real
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| | In some people's situation, they need to
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| estate market. In this type of market,
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| | sell their house before they can buy a
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| if you own real estate, you will make
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| | new one. These people won't be able to
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| money.
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| | rent/option their houses. However, there
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| What about when the price of realty is
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| | will be people who have moved to another
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| going down? How can we make money in
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| | house already and there will be people
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| real estate then? Obviously, if someone
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| | who have invested in a house whose price
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| buys a home at $300,000 and sells it at
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| | is falling. Many times these people will
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| $200,000 he will lose money. So, buying
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| | listen to offers that may lead to their
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| and selling real estate in a down market
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| | disposing of this property.
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| won't work.
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| | At first, people will tell you they will
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| In other types of commodities, we can
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| | only rent to you, but after you ask about
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| short a futures contract in order to make
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| | a rent with option, many sellers will
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| money when the market prices are falling.
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| | change their minds. They will like the
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| Shorting is done by selling something
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| | feeling of knowing for sure; the property
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| you don't own and buying it later. This
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| | will soon be out of their hair. Even if
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| is done all the time in stocks and
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| | you make offers to rent/option and are
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| commodities futures. When you short
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| | denied a few times, you will find such a
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| something you make money when the price
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| | deal if you keep looking. These deals
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| of the shorted commodity falls and you
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| | are made all the time in slow markets.
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| lose money when its price increases.
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| | A great thing about a rent/option is, it
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| Unfortunately, there is no practical way
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| | is just that, an option. If you change
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| to short real estate because when you
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| | your mind, you have the option of not
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| sell real estate, a deed must exchange
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| | buying the property, and if the option is
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| hands. One could argue that a contractor
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| | good for two or three years, by then the
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| could sell a house and lock in a high
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| | price of the house may have increased and
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| price, then build the house sometime
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| | you will have made good money as soon as
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| later as the price for labor and supplies
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| | you exercise your option to buy!
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| are declining because of a slowing real
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| | Making money in a down real estate market
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| estate market. This, though it might
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| | means knowing how to buy properties
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| have some validity, is not the same as
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| | creatively. It also means knowing when
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| shorting the market.
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| | not to buy, namely, in a hot market.
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| In real estate we have to learn to use
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| | Using both cycles of the real estate
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| the slow market cycles to accumulate
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| | market means essentially, you will make
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| properties and to use the hot market
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| | money in a down real estate market
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| cycles as a time to cash in these
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| | because you will be accumulating property
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| properties by selling or refinancing
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| | that will be worth much more in a very
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| them.
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| | short time.
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