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While diversity is always a good idea and placing all of your investment funds in one vehicle, such as real estate, is never a good idea; there is reason to believe that real estate bubble in US is not about to end any time soon. This is true for a wide variety of reasons. First, simply supply and demand. Mark Twain once suggested investing in real estate because as he intimated, they simply arenít making any more of it. What we have is all we have and when there is a strong enough demand; it can be quite valuable. Individuals and families are looking for safe, secure and affordable housing; however there is a dangerous shortage of this commodity. This is primary reasons why flipping real estate has become almost a national hobby. It pays and it pays well.
Under ideal circumstances, an investor can purchase a property with financing from credit union, provide a model renovation and then resell property with a return of around 15-20% on their investment. This may occur anywhere between 3-6 months from initial purchase date. Not bad. Professional investors have also learned how to tap into huge profit potential of foreclosed homes, which they able to be purchased for under market value and then flipped for an even larger profit.
As with any type of investment, one of keys to investing in real estate is in understanding when to sell. Holding a piece of property is rarely in financial best interest of investor. Some investors have found that a mixed strategy of holding and selling works well to provide income returns; however best strategy in real estate investment remains flipping on short term projects to maximize profit potentials and reduce risks.
Nicole Soltau is the President and Founder of CreditUnionRate.com. The Leading Credit Union Directory. Search, Find, Join. http://CreditUnionRate.com