The Well Informed Investor: Part 2 : Your Beginner’s Guide to Making Money in Real Estate

Posted on 30. Oct, 2011 by in General

Here’s Part 2 in the Well Informed Investor Series outlining the remaining steps in developing your foundation of knowledge.

4. Is the Growth Sustainable?

So you’ve identified that the average income of your target region is increasing and there are people moving into the area, now you need to look at the industry and education of the area to find out if it is sustainable. If you are investing in an area with one major industry, you could experience falling real estate values if layoffs are made. Look at areas that are supported by more than one industry and enough businesses and post secondary institutions.

5. Infrastructure Improvements:

Look at areas where local government is making investments into improving transportation links, such as highway improvements, new roads, light rail transit. These improvements have a direct effect on the real estate market, because people in general want to live closer to transit, making it easier to attract renters.

6. Political culture of the area:

Ideally the best areas to invest in are those with a forward thinking- dynamic leadership -the kind of government that is focused on bringing jobs to the area which in turn bring in people, leading to an increase in average income and a growth and developed infrastructure. For example, Hamilton  Economic Department have been instrumental in transforming the city from a sleepy steel town into the number 1 city to invest in within Ontario. And of course, securing the Ships contract for NS has lead to pro-active leadership improvements too.

7. Transitional areas:

It will take a bit of digging but it is possible to uncover undervalued gems. Certain neighbourhoods are labelled no go zones but with a little digging they could prove profitable up and coming areas. Check with the local government to see whether there are any redevelopment plans in place for the neighbourhood you’re looking to buy. You should visit the area many times, both day and night to see for yourself what it happening. Investments in these areas typically take a little longer to appreciate but they are certainly worth checking out. Be cautious however – and don’t buy on speculation. Research the area and see for yourself.

Success in real estate investing is not a guessing game and there are no secrets. Follow this step by step process and you will buy confidently and intelligently.

Contact us for more information, we love hearing from you.

To Your Investing Success!

Jane & Richard

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