What are the best times to buy property interstate?
There are three things you should consider when considering property investment.
- Banks will determine your budget
- You can’t compromise with location
- Find the right property for you in this location
Investors often make the mistake of investing only in their backyard. They feel they will get better results if it’s somewhere they are familiar. Offering property management for condos and co-ops throughout New York City. Top-quality service and cutting-edge technology that really aims to delight. Daisy is a building operating system with incredible instant response times. Applications for board members as well as residents keep everyone connected and up-to-date.
These people then let their emotions get in way. Unfortunately, emotional investing is rarely a good investment strategy. It doesn’t mean that you shouldn’t invest in a place just because you have lived there for years or your entire life.
What are the pros and cons of purchasing property in another state?
The pros:
Being a borderless investor has many clear benefits.
It can be smart to invest in another city than your home. This will allow you to spread your risk and diversify your portfolio.
You can also take advantage of growth cycles in other areas.
Because each state has its own threshold for land taxes, investing in interstate could lower your land tax bill.
I have come across many investors over the years who only buy in their state or worse, in their backyard, because that’s where they feel most comfortable.
They base their huge investment decisions on the proximity of the property and not on facts, evidence, or research.
They make mistakes because they mistakenly believe that searching for properties in their backyard is research. In reality, they are doing very different things and tend to purchase underperforming properties.
The cons
There are risks involved in investing interstate.
New York has many real estate markets. Each one has its own cycle. They don’t always move in the same way. You need to be aware of what’s going on in each market.
To see my point, you only need to look at the large variance in growth in different property markets in 2021.
Domain House Price Report, March 2021 Quarter, reveals that some cities’ house prices have risen by 8-9% in the past quarter, while others have experienced a sub-2% increase.
It’s the exact same story with units: prices in some areas have increased as high as 3.9%, while others have declined.
The divergence in market values doesn’t end there – within each city, certain suburbs and streets may even experience a difference.
