Michigan Real Estate Investing in 2009
Michigan Real Estate Investing in 2009 With all the bad news about the economy, the stock market, auto bailouts, and the housing industry you may wonder if Michigan Real Estate Investing is dead.
While on the surface things may look rather bleak, the ability to boost your net worth FAST has never been greater than right now. Why? Because prices have fallen to all time lows and have set the stage for savvy investors to position themselves to generate unheard of profits in the coming years.
As Michigan goes through a time of change, success as a real estate investor is dependent on two factors. The first is selecting the proper investing strategy and the second is finding funding sources to fuel the growth of your real estate portfolio in spite of the fact that lenders are making it increasingly difficult to secure such loans.
Let's focus on the first of these two important areas as it figures more prominently into your ability squeeze large profits from this unique and sometimes challenging market. But before setting your sites on any one investing method, it's best to get a clear mental picture of the current state of affairs in southeast Michigan.
Unlike the majority of the regional markets across the nation which began to see home values decline at the end of 2006 or the beginning of 2007 when the subprime meltdown began to take effect, values in Michigan began their downward march as far back as the middle of 2004. At this same time renegade mortgage brokers in states like California, Nevada, Arizona, and Florida were still in the middle of their stated income and no-doc mortgage boom.
This extra "down time" has meant that the Michigan market has had to handle all the troubles, stresses, and strains that the national market has been experiencing along with an additional two years of declining home values which other areas have not had to deal with.
Now we all know that people are emotional creatures who often make irrational decisions based on fear and Michigan residents are no different. Watching values decline for almost half a decade has left many Michigan residents in a state of shock. Combine that with the unprecedented number of jobs lost during this painful time of change that the auto industry is fighting through and you see why many locals, deep down inside, hold the misguided belief that values will continue to fall forever.
This is of course an absurd position to take, but as we said before, people placed in extreme situations often cling to flawed concepts and ideas due to their emotional state. Stay with me and you'll see that it's this core belief that opens up the opportunity for those who can peer past the doom-and-gloom news headlines and see it for what it really is.
A large number of Metro Detroit residents are actually rejecting a cornerstone part of "The American Dream" which is the idea that a family's home is their greatest investment and every family should strive to own one.
After focusing on the short-term reality of where home prices are at today, we see a new sentiment taking root among local homeowners that regards renting as actually being better than owning.
Luckily, such notions have not yet been adopted in other markets, but in Metro Detroit you'll hear the new catchphrase "Renting Is the New Buying" being tossed around real estate offices and at holiday gatherings. Renting has lost much of its negative stigma and is instead, for the first time, being heralded as a smart move in the eyes of friends and family.
This unique situation has created an unprecedented opportunity for those who want to supercharge the growth of their investing dollars through the vehicle of Michigan Real Estate Investing. For you see while values have declined significantly, rental rates have not!
A three bedroom brick ranch home in a nice area that would have rented for $950 per month two years ago still commands that same $950 per month today. However, the price of that same home two years ago would have averaged out at about $105,000 while today with a little bit of work and negotiation, it can be found for as little as $55,000.
So here it is...the secret strategy of creating massive profits in Michigan Real Estate Investing in 2009. Very simply all you need to do is buy homes at steep discounts and then rent them out for monthly cash flow or equity buildup.
The old formula of buying a home, fixing it up, and selling it at a retail price is almost nonexistent in a market whose participants are beating down the doors in an effort to be able to rent something.
If you as a real estate investor are willing to give the market what it wants then you'll be able to reap huge rewards in the coming years when the market returns from the artificially low prices that we are seeing today. In the meantime you receive the benefit of being able to cash flow $300-$500 per month on each and every property that you buy, even if you finance the entire amount!
So while you may hear plenty of negative news about Michigan and its economy the benefits of Michigan Real Estate Investing far out weigh any associated negatives.
The only question that remains is whether you'll take advantage of this once in a lifetime opportunity or not.
About the Author:
Brian Kurtz is a real estate investor and licensed Realtor working in the Metro Detroit area. If you found this article helpful then visit his video blog and claim your free 8-part "Funding Fundamentals" video series which shows how you can find all the money you need to invest in real estate at => www.PremierRealEstateInvesting.com
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