The predictions of 2020 looked promising for the housing market, however, the COVID 19 pandemic turned these predictions around and the year was rather rough for the real estate sector. Due to this pandemic, a lot of industry watchers and investors feared a housing market crash. Things, however, began to take a turn in a positive direction for the real estate.
Surprisingly, the real estate market was one of the few sectors that picked up operations during the COVID-19 pandemic. Many investors quickly returned to the market, on the hunt for new real estate investment opportunities.
However, one must apply caution when investing in the real estate market. One question real estate investors often ask themselves when investing in the market is Value or location? In my journey through real estate, one thing I have learned is that the real estate market is an ever changing place. Sometimes what we observe is that a market area or strategy once booming with opportunity can dry up rapidly. One crucial ingredient to success in this market as an investor is being able to identify present market opportunities and having the flexibility and forethought to pivot to take advantage of them.
Bellow .are the four real estate investment opportunities I see for 2021:
1. Residential Properties: The COVID 19 pandemic has created what we call the “new normal” people have normalized working from home and in the long run, they would begin to discover they need more space to accommodate the work from home structure. People are looking for more outdoor space and home offices, there is a need for investors to consider the suburbs of major metropolitan areas, as they’re an ideal investment and have seen an increase in buyer demand.
2. Industrial real estate: Industrial rentals, which generally consist of large-scale properties used for storage, warehousing, manufacturing, or distribution may be a thriving investment in the new year. Ecommerce boomed last year because of the pandemic, quite a number of people were spending considerable time in their homes and this is most likely to continue in 2021.
It is essential to note that this has been one of the top-performing sectors of commercial real estate for the past several years based on returns and demand. In more ways, the global pandemic increased the demand for industrial spaces putting pressure on cold storage, warehouses and distribution centers, and data centers in particular. While this recent demand is likely just a temporary surge, it’s very likely this sector will continue to have a strong year and opportunity for continued growth in 2021.
3. Vacant Land: Investing in vacant land has never gone wrong over the years, although there needs to be a level of experience in order to handle any issue which may spring up. Investors who have experience can deal smoothly with anything which may seem like a major challenge to an individual investor. In this case, investing in a real estate investment trust may be a better option as investors will gain exposure to the investment without the hassles associated with building large-scale properties.
4. Fix and Flips: There is an increasing demand for newly renovated homes, I believe 2021 will be another active year for investors looking to fix and flip. Investors will need to be diligent with their numbers, as I predict the hot real estate market will drive investors back into the business, increasing competition and pushing returns down.
Real estate investment can be a very rewarding market. Despite the challenges which spring forth, these are just a few of the best real estate investments to consider in 2021. Explore the different real estate investment opportunities and choose what works best for you.
Whatever path you choose, you still need to determine the most profitable real estate investment.
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