[ACCESSWIRE]
LOS ANGELES, CA / ACCESSWIRE / September 23, 2018 /
Shifting Real Estate Market: Add Value
Today's economy is thriving with rising employment rates and global equities that are at the top of the charts, yet not far behind these current trends is a pending shift in the market that will influence both the business and commercial real estate markets. The wise approach in times like these is to watch for investment opportunities that lend themselves to adding value and leading to a flourishing return whether the market is doing well or poorly, according to Neil Shekhter, the chief executive officer at NMS Properties.
The Market Cycles
Right now, in the market, returns are low, and the costs and risks of real estate are elevated. Because of this, investors are on the hunt for investments that won't lose money. This is the beginning of a market cycle, and these cycles tend to run in periods of between seven and twelve years. According to analysts, that means the current market is headed for a recession within the next couple of years as evidenced by a hike in oil prices and interest rates.
Following the last recession, developers invested in real estate and are reaping the profits because they knew when to get out. A good investor's market won't last forever, and the idea is to find where value can be added in order to improve the return on real estate when there's already too many listings and not enough buyers.
The Benefit of Adding Value
A profit can still be made in times like these by finding where value can be added. An example of this would be to find assets that aren't performing well and need some improvements. Then, you can make those adjustments and put the listing on the market with a higher rent.
If you can purchase real estate at a lower cost on the dollar, you can turn it around for a profit by adding value. This is the kind of strategy that works well since you can exit the asset once you've put value on it and can earn the highest profit. Alternatively, you can hold the asset and have a steady influx of cash. This option still allows for the possibility of reaping a profit later on. Knowing when to buy is the best determiner of whether you'll make a profit. The right buying time is even more important than knowing when to sell.
The Federal Reserve will continue to raise interest rates through this year and next, and cap rates will also rise while real estate prices will fall. This part of the cycle is the perfect time to look for investments, and investors can be prepared for this upcoming shift in the market. As you watch closely, you'll be able to find great investment opportunities in order to turn them around for a profit.
NMS has offered quality rentals in the Los Angeles area for nearly three decades. Since 1988, NMS has developed and managed a large portfolio of premier apartment buildings and commercial properties in Santa Monica, West Los Angeles, Brentwood and the San Fernando Valley
NMS Properties, Inc.
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SOURCE: NMS Properties, Inc.
https://www.accesswire.com/512433/Neil-Shekhter-NMS-A-Wise-Approach-When-the-Real-Estate-Market-is-Shifting
