If you think selling a house is hard now, just wait until next year. And the year after that. And the year after that. And the … okay, you get the point. According to the latest Goldman Sachs forecast, real estate investing will hit rock bottom in 2013 and won’t recover to pre-crash levels until 2023. If you’re selling a house right now, that’s bad news no matter how you slice it.
Until the government figures out what to do with all those foreclosures, far too many Americans will be underwater on their mortgages. Money will be squandered. Jobs will be lost. We’ll be helpless to change any of it.
However, there’s a silver lining to every cloud, and in this case that lining comes in the form of small cities. Previously “obscure” metropolitan areas like Pittsburgh and Boston are all the rage right now, so if you’re lucky enough to own property in one of these markets, you should be able to find a buyer within a reasonable amount of time. Suburbs should also remain stable enough throughout 2013 as well, but we can’t make any promises.
The biggest problem a real estate investor will face next year will be trying to sell properties in a small town or in a slumping city like Cleveland. The average market value is already in the pits in these areas, and it definitely won’t get any better in 2013. Our best advice for any investor with these sorts of properties is to get comfortable. Consider renting out vacant houses to offset costs. If you find a buyer, sell.
We’ll be the first to admit that things aren’t looking good for anyone in the business of flipping houses, but that’s no reason to panic. The market will recover eventually – it always has. Until then, just do your best to grin and bear it, knowing that we’re right here with you.
