With a current deceleration in the residential property boom, many home owners / investors could be lulled into a sense of impending doom, and hasty decisions on selling their properties. However, history has demonstrated that such real estate declines are cyclic, property value following a 7-12year cycle (dependent upon location). Rental income typically follows a 7yr cycle.
Behind the falling real estate values are such economic factors as declines in foreign reserves and commodity prices. There tends to be an inverse relationship between the property and stock market.i.e. as real estate value increases, interest rates tend to increase and share price reduction tends to follow, hence reinforcing the advantage of property and stock market portfolios running in symbiosis.
So, rather than attempt to cash in on the last shred of profit in the real estate market with a quick, un-timely sale, we should be focusing our efforts on 'riding out the storm', rather hold and value add/ maximise cash flow. Following the slump in property profits are interest rate reductions, which
Simple Value Adding Strategies:
Relatively simple measures may be taken to value add to our investment properties whilst the market 'picks up'. Such inclusions range from 'refreshments' to your investment to re-structuring finances.
This article covers various strategies and ideas that may be adopted for varying budgets and manual skill-sets.
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