Over the past decade, investing in real estate has become more popular than ever. Whether it’s due to the onslaught of fix-and-flip shows or the undeniable opportunities found in a post-Great Recession America, there are millions of real estate investors in the United States today. Even in 2012, real estate investment was a $9.2 billion industry with some 28 million self-identified real estate investors.
Today, with a steady increase in rental demand (there are 44 million renter-occupied properties compared to 75 million owner-occupied homes), the industry has only grown. However, with real estate market challenges facing owners and investors alike, how do you succeed in a market that is saturated and highly competitive?
No matter how many people are investing around you, you can succeed in real estate investment.
3 Ways to Succeed in a Saturated Real Estate Investment World
Investing in real estate isn’t like a traditional job or business. You don’t distinguish yourself by having a “new spin” on the business. Differentiation (and success) aren’t necessarily about your resources either, be they financial or otherwise. No, get ahead of the pack in simple and unexpected ways.
Target Unexpected Markets
“Hot” and primary markets can pose significant challenges for investors, particularly those who have limited resources. One of the best things you can do for the growth and health of your portfolio is change your targets. Secondary and tertiary markets are experiencing a real estate revival as net migration pulls in their favor.
Be sure to check out: Secondary Markets for Long-Term Real Estate Investment Success
The affordability crisis in the country has led to the exodus of significant portions of the population in primary markets. This has led to an influx of population (and thus, demand), in secondary markets where the cost of living is more reasonable.
Real estate investors do well to target such markets. While you always want to focus on markets with a diversified and growing economy (in other words, thoroughly research the state of any market you perceive as an investment), these less popular markets offer hidden gems for real estate investors.
Avoid Bidding Wars
One of the biggest challenges facing today’s real estate market is the profound lack of inventory. Home-building can hardly keep pace with demand for both personal and rental residences. On top of that, existing inventory has begun to shrink as owners are reluctant to sell. Because of this, any inventory on the market, particularly more affordable offerings, are in short supply. The demand for these properties means that any listing can expect multiple offers and bidding wars.
For the real estate investor, bidding wars are not only a waste of precious time, but they can throw the debt-to-income ratio out of your favor.
What’s the alternative? Utilizing a turnkey strategy saves you from the headache and hassle of bidding wars — or even the arduous process of property inspections, negotiations, and other difficulties associated with buying a property. Because your turnkey provider purchases, inspects and renovates properties that are ideally positioned for generating passive income, you can effectively cut the line and start investing sooner rather than later in great investment markets.
Focus on Quality
While every investor should have a mind geared towards portfolio growth, it is far from an investor’s only priority. Instead of focusing solely on the sheer number of properties in your portfolio, focus on the quality of services afforded to your existing investments.
Passive real estate investors can do this through a trusted turnkey partner whose excellent management maximizes your profit and value.
For our part, REI Nation prides itself on providing premier property management services. Too many investors compromise and either try to manage their properties alone or with subpar management services. While saving money on the front-end can seem like the best course of action, paying for quality management is where real estate investors find long-term success.
It’s the long-term preservation of residents and property conditions that ultimately maximizes your wealth. Not only that, but allowing trusted individuals to care for your investments frees up more time and space for further property acquisitions when the timing is right. For investors trying to beat the market, turnkey investing is the path of fewer frustrations and greater opportunity.
Beat the competition. Invest in real estate through REI Nation for access to world-class investment markets, opportunities, and wealth-building.