When you think about investments, your 401K, stocks, and bonds probably come to mind. However, many people are unaware that real estate can be a profitable and smart addition to your investment portfolio. In fact, property investment can be one of the best financial decisions you make for yourself! In this blog, we’ll outline a few reasons why you should make property investment a priority in your life. The Wilstein Team is a Park City real estate company that can help you with property investment, real estate marketing, and more! Contact one of our real estate professionals today for more information!
Buying a Home
Buying a home is a monumental decision, and one of the most important things to consider when you’re thinking about buying a home is your ideal location. Even if you intend to remain in your new home for the foreseeable future, unexpected events can occur at any time, and you may subsequently find yourself having to sell your home. Choosing a home with a valuable and in-demand location ensures that it will be highly unlikely that you will lose money on your home, even if you have to sell it suddenly.
The technical term for increasing home value is “real estate appreciation,” and there are several ways that real estate can appreciate. Most of us are familiar with basic economics: prices tend to rise as demand rises, and real estate is no exception. Buying a home in an in-demand area is a smart, long-term investment strategy, as it’s nearly guaranteed that the demand for housing in the area will lead to higher home prices. Park City is a bit of hybrid market; while it can be considered a resort town due to its ideal location for skiing and mountain vacations, the town has a vibrant and thriving residential community. For this reason, properties in Park City will remain a smart investment choice, even if the economy experiences a downward turn and people take fewer vacations.
Buying a Vacation Home
Buying a home in Park City is a great choice, whether you’re looking for a place to settle down or a classy vacation home. Many homeowners in Park City own properties throughout the country and come to Park City during the summer and winter. As we noted in the previous section, the increasing value of homes in the Park City area is an asset for you, and owning a home will save you a substantial amount of money in the long run if you frequently pay to stay in hotels or condos.
If you want to talk about great investments, the income generated from an in-demand rental property can also provide you with substantial and steady returns on your investment. If you’re concerned about how much work is involved in becoming a landlord, especially if you live out of state, you can always pay someone to manage your property. While this does take away from your overall revenue stream, many investment property owners find that the peace of mind is worth the cost. If you don’t want to become a landlord at all, temporary rental services like Airbnb can generate income for you without requiring much in terms of property management on your end.
While property investment in Park City has been a great source of wealth for many residents, real estate investment does come with risks. Though we don’t currently anticipate it, in theory, the real estate market could crash and make it difficult to profit from your property. There’s an important distinction that needs to be made clear when it comes to property investment, and the distinction concerns the timeframe in which you’re hoping for a return on your investment. While the thought of a real estate market crash is understandably terrifying, in the long run, property values will increase as the market stabilizes.
The main takeaway here is that property investment is a long-run investment plan, and if you’re looking for get-rich-quick schemes, you’re probably better off taking risks with penny stocks. If you’re interested in learning more about the Park City real estate market, The Wilstein Team offers free videos and helpful resources that can help you with your next real estate purchase. We’ve helped buyers and sellers in the Park City real estate market for 29 years, and we’d be happy to help you find your next investment property!