So you are wondering what the best investment are in a down economy are? I’m not sure I want to divulge a secret valuable to an amatuer investor, but I will. Investing in a down economy comes down to one thing, knowing your target market. There are many things to factor in such as culture, history, population change, cost of the investment and etc.
Culture
When investing you should monitor the culture of the neighborhood. The neighborhood is one the most overlooked aspects when investing. Investors have a tendency of buying a house in a neighborhood designing in accordance to their taste as opposed to what the community will buy. If you buy property in a neighborhood which has a lot of charm chances the style houses are country, however you may run into contemporary style housing.
History
When you are looking to buy a house in a down economy make sure you look at the history of the house and the neighborhood. When looking at the history of the house you should be aware of its potential as well as the downsides of the house. When monitoring the history of the neighborhood you should look at the type of people who lived there. People have the tendency to underestimate the importance of the history of the neighborhood. A good rule of thumb is to anticipate if the neighborhood is on the come up or if it is on its way down. Either way monitor which type of people each scenario attracts.
Population change
The population change is important in determining how long you should hold on to your investment. If the people who moved into the neighborhood during the down economy is a low class of people chances the value won’t increase when the economy is booming. Predicting the population change is important because you may incur a liability as opposed to an investment.
Cost of the investment
When investing make sure you look at the price history of the investment. When looking at the price history you will have an idea of how to price it when it comes time to sell. When looking at the price history you will know how much you can make on your investment. The return on the investment is more important than the cost of the investment. Usually condominiums offer the best of both worlds when investing. Condominiums allow you to make a lot of money without having to invest a lot into the interior. Condominiums the exterior is taken care of by the board.
There is no particular investment which best suits a down economy rather factors to look for when investing. Do your homework before you start cutting the check. Good luck!