Investment Property In Hot Markets

By Author: Alexandria Anderson
Total Articles: 46
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Investors in real estate are typically looking for the hottest markets. Where can they purchase, and what can be purchased, that will make them though most money? It's not that hard to discover as long as you are able to get rid of the clichés and determine what constitutes a hot market.

According to Ken McElroy, author of The ABCs of Real Estate Investing, a hot market is something that is in short supply and high demand. For example, if there is a piece of land on the water that seems undesirable, but is able to be developed, that may be a piece of hot property. Often, even highlyexperienced people will be unable to distinguish what is in front of their own eyes. If a property is overgrown, for instance, or needs a facelift, it may not up here to be a good deal to someone who is not paying attention. But the very fact that it is on the water, a place where people want to be, might make it worth looking closer at.

Another type of hot property, according to McElroy, is a unit with personality. He mentions the Venice Beach area of California, which was featured in a movie called Lords of Dogtown. This is a ...
... tough, edgy spot full of skateboarders and surfers. It's hip, and the fact that someone lives there says to everyone else that they are groovy, edgy and artistic. If you can buy a piece of property in that area, there is instant interest, simply by reason of the cool factor.

Not all areas have personality, however. But they may have other things, like existing industry, or a big box retailer on the way. Corporations bring jobs and jobs bring more people, who need places to live. If people are moving in from out of town, they are most likely feeling fairly optimistic, looking forward to a new life in a new town with a shiny new job. Their positive outlook can work in your favor.

Military bases draw a lot of people as well, and not all military personnel live on base, as McElroy. points out. He also warns, however, that real estate investors should be careful when banking on military bases, as government budget cuts can sometimes mean the closing of these bases.

Plain old visibility can also qualify a property as hot, or at least increase it's hotness factor if it is in fact a desirable place to live. Lots of drive-by traffic can be a positive thing. Drive-by traffic is free advertising. It also means that there are already lots of people passing by the property, and probably that the property is on the way to work for a lot of commuters. Maybe it would be a closer trip for some people, which is a good thing.

What it comes down to then, is that a hot market is property where the people are. If the area has a large population, or is expecting an increase in it's population, it means their's a good economy, and a good economy is what will maintain your real estate investment business.