Updated: Sep 8
Traditionally, the success of real estate investing in primary or even secondary markets, was largely dependent on whether an area was experiencing a buyer’s or seller’s market. Let’s go over these markets first and then we’ll tell you all about why tertiary markets take these problems out of the equation.
How to evaluate a buyer’s or seller’s market
Real Estate Inventory: See how many homes are listed for sale. If it’s a lot, you’ve got a buyer’s market. If it’s very few, you’re looking at a seller’s market (low competition). You can get a more precise idea of inventory by dividing the number of homes currently on the market by the number of homes that have sold in the last month. If the result is 8 or higher, it’s a buyer’s market. If it’s 4 or below, it’s a seller’s market. Anything in between is considered neutral.
Recent Sales: Check out what comps have been selling for recently. If you see that homes have generally been selling above asking price, you’re likely experiencing a seller’s market. If they’ve been selling below asking price, signs are pointing to a buyer’s market.
Price: This one’s simple. Check the pricing history of several homes in the area. If you see that the sales price has been cut on most of them, you’re definitely in a buyers market.
Time On The Market: The number of days that a home is on the market is another indication of the housing market. Homes generally sell faster in a seller’s market and take more time in a buyer’s market.
The downfalls of traditional real estate investing
Most real estate investors are either lucky to sell in a seller’s market or sometimes forced to sell in a buyer’s market. This made real estate investing less secure than we liked. We needed to find a way to revitalize real estate investing, and with Reunion Investments, we did just that.
In tertiary markets, investing has less to do with ideal market conditions and more with taking advantage of the massive equity buying power available to you. The Reunion Investments difference is, instead of being controlled by market conditions that rely on others, our investors have more power over the entire market of a local area. This is because we use investments to build up entire communities – apartments, retail, restaurants, etc. As the community grows, so does your investment.
Virtually no other investment firm has the connections in place, staff at the ready and boots on the ground experience that we do, when it comes to tertiary markets. More now than ever, the security of your investment should be a top priority for you and your family. Contact Reunion Investments today for a consultation on how we can make your money best work for you.