Buying a home – risk or investment

As the economy crashed in the last years so much, the real estate market was severely affected. After the 2008 crash, the prices on properties dropped heavily and fast. It is said that  there is no better moment to make serious money than in a time of economical crisis. This is partly true. If you have some money, then you are in luck because theoretically everything is cheaper. In real estate matters, this theory is true. Owners of valuable properties have lost great sums of money, when it came to selling.

If you are trying to see whether the financial crisis has passed or not, then you need to look at the real estate market. If the prices start to go up and stop at a certain level, then the economy is doing well, but if they go down, you are still in danger. The main issue today is whether buying a house is a risk or an investment. Until the 2008 crisis, owning a property meant you were an investor, you couldn’t lose money. People were encouraged to buy houses, using the help of banks. This is the point in which buying became risky.

In 2012, it seems that in the real estate market improvements are made, due to the high number of transactions. The important issue here is how these purchases are made. It is important to determine how risky it is for a normal person to buy a home. Asking for the bank’s help means getting a loan, paying an advance, which represents at least 15% of the property’s value and after that, you have to make a monthly payment, until you have completed the sum of money loaned.  This is a bit tricky, because the economy is still not fully recovered, so this means that changes at your workplace can appear over night. One can consider buying a house today an investment, only if it is paid on the spot, without the help of the bank. When the real estate market will start growing again, then you could even sell it for a larger sum, making profit. After you sell it, if you live in San Diego for example you can move very easy. You can hire some San Diego movers and you will be out of there in no time.

Still, nowadays to have a big sum of money on your hands, is not accessible to anyone. That is why governments all over decide to help their citizens to buy a property, so they have come up with special  programs. You will still have to loan money, but the terms have been altered to suit to your financial condition. For example, the deposit you make, after choosing the house, can be of 5 % of the sum. You could also benefit from a smaller interest rate. If you decide to go this way, then research  how to apply to these programs and pay attention to all the terms and conditions.

The real estate market differs, there are many offers, some properties seem not to have been hit by the crisis at all. So, if you want to keep away from risks then try to buy something that you know you can afford. Remember that the bigger the loan is, the harder it will be for you to pay it.

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