Can You Afford to Wait Out the Housing Market Crash of 2008?
During 2005-2006, real estate was regarded as one of the safest investments on the market and one in which you could make a quick profit. Although many did realize that there were risks involved in this type of investment, no one could predict how far and how fast this market could fall.
Real estate still continues to be a sound investment with population on the increase, especially in cities where there are jobs available. If you have investment properties, you have to take a close look at them to determine if you can afford to wait out the crash and be still in the business when the market does start to rebound.
When the downturn took place in the housing economy, the first thing that many investors did was to try to sell their properties as quickly as possible. They figured that the market was about to get worse so they figured the best thing to do was to cut their losses and get out of the market. The fact is that if it is financially possible, it is better for an investor to hold on to the property and try to wait until the opportune time to sell at a profit.
When you jump into selling your property just to get it off your hands you run the risk of losing money on the sale. With house prices decreasing at a rapid rate and the influx of so many properties on the market at the same time, buyers have many options to choose from.
They are expecting concessions in the form of discounts, which means you will likely have to sell the property at a lower price than you originally intended. For many who are finding themselves in a financial crunch because of mortgage payments, it may also be the best course of action to take.
Having investment property also has an impact on your income tax. There are tax incentives and advantages available to investors that you may not know of and therefore are not using to your advantage. Before you decide to put your property on the market, you should consult with a tax professional to see what is available for you.
You may be able to cash in on some of these tax credits which will allow you to hold on to the property for a while longer. An example of this is write-offs that can provide you with assistance to stay afloat until the market starts to rebound.
If foreclosure is in your future, then you would be well-advised to sell the property before this happens. In this way you can retain your credit rating by repaying your mortgage in full and obtain a small amount of profit from the sale.
In this way you won’t incur a complete loss on your investment. In order to get the asking price you want for the home, you do have to look for ways to make the property as attractive as possible to potential buyers.
For those who have had property on the market for quite some time and it is not selling or attracting interest, you should take a close look at the property in an effort to determine the reasons for the lack of a sale. Research the market in the area to find what the home prices are and take a look at those properties to determine features you can install or correct in your property.
The main thing to remember as you try to wait out this real estate crash is that you should remain calm and not panic. If you make a hasty decision and sell at a loss right now, you will be sorry for it when the market starts to rebound.
Look at all your options before you jump into selling and if you can manage to ride out the recession you will be in the prime spot to make a killing on the new and improved housing market.
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If you want to learn about Cause of Market crash 0f 2008 then check this post.
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