Did you know that historically Real Estate is the number one investment vehicle in the world?
Historically, Real Estate Investments have made more money for investors than any other vehicle including the stock market. That ought ruffle a few feathers from our stock broker friends. Many times stock brokers will compare various different statistics and show that if you invested a certain amount of money at a certain date invested in a certain stock or group of stocks the return over a specific period of time would have been higher than if you invested in Real Estate. There are lots of examples of that in history. However, there is always one factor that they tend to leave out. What if you could buy a stock and someone would loan you 80% of the money to buy it so you could buy many more shares but then someone else would pay back the loan for you. That's the difference between the Stock Market and the Real Estate market. A stock cannot have a tenant. In my opinion the decision to buy a Real Estate investment based solely on the idea that the market value of that investment is going to increase is an incredibly risky investment, unless of course it's your principle residence. Cash flow is king in Real Estate investing. If you invest $40,000 on a $200,000 townhouse and the rent covers all expenses including the financing and shows a return on your $40,000 over the expenses; that's a good investment. You then have 3 ways to make money. 1. Possible increase in market value over time. 2. The tenant is paying down your debt thus increasing your equity. 3. A return on your cash investment over and above your expenses. Obviously, I'm biased but that's the world according to me. If you would like to look into investments that can create this kind of return give me a call.
Did May Sales up in all 3 zones, Absorption rates higher than 2007
In May of 2014 home sales were up in all 3 zones again; the North Okanagan, the Shuswap and the Central Okanagan. Whether we compare year to date numbers, running averages or just month over month sales are up dramatically. Year to date sales are up 42% in the North Okanagan compared to the same period last year. The absorption in the Central Okanagan stayed above 20% for the second month in a row and it topped 20% in the North Okanagan. The absorption is the percentage of the total residential inventory that sells on a monthly basis. These numbers are higher than we have seen since August of 2007. What is fueling this surge? There are many factors; the country wide economy and Real Estate market recovery in the US, Canadians starting to sell their investments in the US and reaping profits, a booming Alberta economy, a lower Canadian dollar enhancing our lumber exports, record low level interest rates to mention just a few. None of these factors are predicted to go away soon. It seems the planets are aligned and we will reap the benefits for a while. Once again, it's a great time to buy Okanagan Real Estate.