We are now officially in March and the spring market has kicked in! I’m beginning to notice some very strong tendencies that I haven’t seen in a long time. These factors are coming from the rental market, the student/parent market and the investor market. With parents looking for either a property to rent or buy for their student, the sales and rental markets are both strong around campus. This is happening because through the recession of the past 4-5 years, very few new homes and properties have been built which is restricting the supply.
However with increased enrollment at the universities, more people choosing the junior colleges and the overall quality of San Luis Obispo, a high demand is being created on top of the restricted supply. I have been receiving countless calls from people looking for homes, but the reality is that there isn’t much for sale. How does all of this affect the real estate market?
Well, with the emergence of spring, we always get a push from the market from parents buying single family homes for their students. I also have clients that are interested in investing in real estate but the rise in home values have caused them to think otherwise. A few years ago, you would have been able to purchase a home and make 5-6% on it while now it is more like 3-4%. You also have to look at real estate investing in the long term; having a long-term vision allows you to see many of the benefits that come with investing in real estate.
With the market pressure being pushed upwards, high demand and the rising price of rentals, you will find that an investment property in this market won’t give you a large return, but actually a steady return and over time will become a phenomenal return.
If you have any questions in regards to investing, please give us a call. Thanks and have a great day!