Why Looking at Real Estate Price Charts Is Misleading

Real estate investors frequently refer to housing price charts to help analyze trends in the real estate market. These price data are typically the Housing Price Index, or HPI, provided by the Federal Housing Finance Agency. Also, you will often find references to the Case-Shiller Index, which is a composite of either 10 or 20 major metropolitan areas (Metropolitan Statistical Areas or MSAs). The Case-Shiller Index is commonly considered a fair measure of the U.S. housing market. However, smart investors will look at their local market data rather than national data. National real estate statistics are only relevant to macro-economic conditions and not very useful for your real estate investment in a particular city.

The other problem is that real estate investors will look at housing price charts which are very difficult to utilize in making decisions about their investment (i.e., whether to sell or buy a property). That’s why so many investors lost properties in 2007 and 2008. Having access to data for your investment city presented calculated and presented in the proper way can give the investor clear signals when you should sell your property due to changes in prices in the real estate market. You will need to calculate housing index price changes, and then adjust those data for inflation.

If you look at the housing price index chart for Boston, you wold notice that the price index peaked at the beginning of 2006. But if you owned a property in Boston at the beginning of 2006 and looked at the chart then, you would not know if this was to be a peak or just a pause in the upward trend. Your investment property was about to suffer a massive decreases in price. In contrast, Looking at a housing price change chart would clearly show changes in prices and the dramatic change that occurred at the beginning of 2006:

Here is a link to the two charts for Boston, MA. the first chart is the Housing Price Index chart and the second is the Housing Index Price change chart (adjusted for inflation). The Housing Index Price change chart calculates the annual price change, with smoothing calculation and inflation adjustments. When the line is above zero, prices are increasing; and when the line is below zero, prices are decreasing.

Momentum: More advanced: a downward sloping line means the price momentum is decreasing and an upward sloping line means that the price momentum is increasing. The concept of momentum is commonly used is stock trading, where it is used to describe the trading activity increasing or decreasing with price. For housing prices, an example of a decrease in momentum would be a situation where prices were increasing, but at a rate less than the prior period of time. Using Boston as an example, in 1Q2005 the HPI had increased by 11.2% from the previous year. In 1Q2006 it had increased by 4.3%. Prices were still going up, but at a less rapid rate: a decrease in momentum.

Looking back in time, the indication to get out of the Boston housing market was reasonably clear in 1988 and 2006. But when to get into the Boston market and buy a property is difficult. Price changes can easily go above the price change zero line and then quickly cross back below the zero line (i.e., prices increasing-above the zero line and prices decreasing-below the zero line). The general concept is that you need to wait a sufficient length of time of price increases for that market, then purchase your investment property capturing peak appreciation periods. The trick is to know how long to wait, and decreasing your risk.

This was the challenge that I solved, out of which was born HousingPriceTrends. In an effort to educate real estate investors, I have provided a volume of historic price change charts for over 400 U.S. cities. Remember Warren Buffet’s rule #1: Never Lose Money. With the proper information you can sell your investment property in a market that has lost price momentum before your investment property loses money. There is always another city in which to invest where the price trends are in your favor. So, sell your investment property in a market that has lost price momentum before your equity starts to decrease. The secret is to only be in invested in cities where you can capture peak appreciation periods, and having clear signals when you should sell in those cities. Never get trapped in a national housing crash again, an

Marketing Real Estate Online That Will Get You Traffic

With the housing market being as competitive as it is these days you will want to use any marketing tool available in order to gain the advantage. I don’t know of any agents who use the principles I’ll be sharing with you for marketing Real Estate On-line that will get you traffic. Using these techniques will get your web site or listing on the first page of giving you the best On-line exposure possible. Right now you have enough computer knowledge to implement the process. The out of pocket expense is minimal and you can get this going in your spare time.

Marketing Real Estate On-line
What will get you traffic? We are going to use the same principles Internet Marketers use to build their businesses. First off, you have to have a web site or listing On-line to drive the traffic to. Most of you have your own web page already. Now the secret is using keywords people enter when searching for Real Estate. I’ll use my town for the example here. A person Google’s…Antioch Illinois Real Estate listings, and several thousand article listings come up. (See where it says results above the listings?) Now do the same keyword phrase in “quotes” and you will see about 2300 article listings for that phrase. Any number under 5000 means low competition for that phrase.

Using the same example you will write a informative article about Antioch Real Estate, writing 300 to 500 words making sure you use the keyword phrase…Antioch Illinois Real Estate listings 3 to 5 times through out the article. Now you must use the keywords in the title of the article as well. The title could look like this…Brown’s Realty-Antioch Illinois Real Estate listings. This strategy is excellent for marketing Real Estate On-line that will get you traffic.

Google loves information, and with the low competition you will be sure to rank first page. Once you write the article you will point the reader using a link at the bottom of the page to either a web site or a Real Estate listing page that you want to sell. Simply look over the format of this article and it will give you a good idea on how it’s done. There are several “free” article directories to submit the article to. The power of this method becomes clear when you repeat the process over and over again using different keyword phrases related to Real Estate. At first it will appear awkward as you work through it. But once you get it down it will take less than an hour to dominate marketing Real Estate On-line that will get you traffic.

My purpose here was to give you an overview on just one of the marketing methods. You will need to educate yourself on the details of this strategy. The information you learn will open your eyes to numerous opportunities regarding marketing real Estate On-line that will get you traffic. There is nothing more exciting that seeing your work on the 1st page of Google.

Statistics say the only thing stopping you is simply not starting. By far the most superior Internet Marketing education site out there is Wealthy Affiliate University. With a Minimal investment of $39 you can join for one month and explore all the incredible resources this community offers. You will learn marketing strategies you never dreamed of. It’s really a small price to pay to know for sure that you can rank 1st page on Google. At the very least, simply explore their web site Marketing Real Estate [http://www.Scan4theScam.com] and see why 1000′s of folks are joining, learning the value of Internet Marketing techniques.

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Real Estate Marketing

Learning about real estate marketing is probably one of the most important activities an agent can do with his or her time. Although some would argue prospecting is more important, I would challenge that. Because you can spend a lot of time prospecting the WRONG way. Real estate marketing know how will enable you to become very efficient in your prospecting. To be successful, you must pick a niche market and speak to that niche’s needs, wants and desires.

Smart real estate marketing starts with education. You must learn the pros and cons of each type of marketing. You have online real estate marketing and then you have off line real estate marketing. Both should play an important role in your over all real estate marketing plan.

Off line real estate marketing uses advertising mediums like classified ads, homes magazines, signs, etc. Online real estate marketing focuses on generating business via the internet.

Depending on the community in which you are looking to market your services, one can be better then the other. For example, if you live in a smaller community that is very rural, your real estate marketing plan should focus on off line marketing mediums because there probably won’t be enough internet traffic (people performing searches online for your communities main keyword) to justify an internet marketing campaign. However, if you live in a popular city where there are a lot of internet searches for homes in that area, the internet is definitely the way to go. Generating leads off the internet is the MOST efficient way to market. Everything is trackable and you can control costs – you know how effective your campaigns are and you can keep track of your real estate marketing metrics.

If you do live in a smaller community, one smart thing you can do is take off line traffic and drive it online. For example, advertise your lead capture website on your signs and print ads. Say something like, “Get the most up to date MLS listings for free at [http://www.AnyTownHomes.com]“. This works very well as it will allow you to offer information to prospects in a baby step.They will go online before they will pick up the phone and call.

To find out the amount of searches that are being done for your community, go to http://WordTracker.com. WordTracker has stats on how many times a certain search phrase was entered for any given keyword. If it looks like your area is getting a lot of searches, set up a lead capture web site, drive traffic to it via pay per click, and make that your main real estate marketing campaign.

We live in a community where we use both off line and online real estate marketing. To see how we incorporate the two and generate a steady flow of leads to our Inbox, check out our free real estate marketing guide, the “Smart Agent’s Lead Generation Confidential”.

The bottom line is do your due diligence and learn all you can about real estate marketing especially internet real estate marketing. It is the smartest thing you can spend your time on. Without the proper education, you can get real busy yet generate no business.

For more information about online real estate marketing and a free real estate marketing guide, visit:

High Speed Rail a Real Estate Investment Opportunity

America’s renewed interest in high speed rail could be a tremendous opportunity for real estate investors.

This term refers to supped passenger rail service in which trains run at speed of over 150 MPH. The Obama administration has already pledged $8 billion in federal funds to build high speed rail lines. Construction of the first HSR lines could begin in California and Florida as early as next year. In 2008 voters in California approved several billion dollars in bonds for high speed rail construction.

High speed rail will be a tremendous real estate investment opportunity for several reasons. Those who take advantage of those opportunities by buying up property along or near high speed rail lines could make a lot of money.

Why High Speed Rail is an Investment Opportunity?

Land around major transportation infrastructure projects like freeways, Interstate Highways, airports and mass transit lines often goes up in value. The land goes up in value because the travelers using the new transportation system require services which provide an opportunity for service businesses.

Just look at all the gas stations, truck stops, restaurants, hotels, motels, car washes, restaurants, convenience stores, fast food joints and other businesses on interstate off ramps. Or all the hotels, parking companies, restaurants, car rental agencies and other businesses that pop up around airports.

Don’t you wish you could have bought land around a major airport or interstate off ramp years ago before it was built? Well you now have an opportunity to buy land along and even on fast train routes before they are built.

High speed rail lines in Europe, Asia and the Northeastern US attract hundreds of thousands of passengers everyday. The new high speed rail lines in the US are likely to attract similar numbers of passengers who will spend their cash at all kinds of service businesses. Those service businesses are going to need property to locate on they will pay for prime locations near high speed rail lines.

Railroad Stations as Real Estate Investment Opportunities

Some of the best real estate investment opportunities will be around the stations. Land around airports often increases in value as does land around commuter rail and rail transit stations.

The land within easy walking distance of high speed rail stations will be the most valuable because businesses there will have direct access to rail passengers. Car rental agencies will definitely want this land because many of not most rail passengers will want to rent a car when they get off the train. Fast food joints, restaurants and convenience stores will also want to locate there to sell food and other items directly to passengers.

Perhaps the biggest opportunity around the stations will be parking lots. Most of the passengers will drive their cars to the station and they’ll need somewhere to park. The biggest problem at many rail transit stations is parking, many of these facilities don’t have enough parking.

Just like at the airport, parking lot operators will move in to take advantage of the situation, and they’ll need a lot of land. The closer the parking lot is to the train station the more money its operator can charge for spaces.

Parking lots near high speed rail stations because they could be a real estate investment that pays for itself. An investor could buy land put in a parking lot and use the parking charges to cover his costs until a developer comes along and buys the land. Existing parking facilities near stations will be a tremendous investment. Properties such as vacant lots, older housing, older building, abandoned houses and undeveloped land within walking distance or a short drive of high speed rail stations will be a good investment because they can be converted to parking lots.

Another good investment is rental property within walking distance of a station site. This is another investment that could pay for itself in the form of rents while the owner waits for a developer to buy it. Even if a developer doesn’t buy the property, the owner will probably be able to increase the rents the high speed rail line opens for business.

The best way to locate land near rail stations is to find the maps of proposed fast train routes located on the internet. Most of these maps will show where the stations will go. An investor can locate at these and then go to the site of the proposed station.

Many of these stations will be in depressed older areas where property is still fairly cheap. A good way to determine which properties will increase in value is to walk around and locate properties within walking distance of the proposed station. One tip start looking and buying before construction begins on the rail line or the station because that will raise prices.

The Next Housing Boom

The other investment opportunity in real estate created by high speed rail will be in new housing developments. High speed rail will lower travel times and the cost of travel in a lot of areas of the country and open large areas of land to housing development.

In California the proposed fast rail system will make a trip between Los Angeles and Bakersfield in less than an hour possible. Since real estate costs and living in Bakersfield are much lower than in LA many people will move to Bakersfield and commute to Los Angeles on the high speed rail. Naturally, real estate developers will take advantage of this with new subdivisions for all those new commuters.

The California rail will also go through of California’s fastest growing bedroom communities including Lake Ellsinore, Temecula, Palmdale and Lancaster. Those areas will probably see a growth in population and property values when the rail arrives.

In Florida the proposed rail line between Tampa and Orlando will go right through rural Polk County where there’s lots of empty land. Since Polk County is halfway between the two cities and the high speed rail trip will take about an hour that means Polk County will be a half hour’s commute from two of the nation’s most popular and fastest growing metropolitan areas. It won’t be long before developers take advantage of this new commute machine for Floridians with large numbers of new subdivisions.

Bedroom communities and other real estate developments along high speed train routes could be the next great American real estate boom. Those who buy up property, especially empty land that’s already zoned for development; in those areas could reap a large fortune. Naturally, all those new homeowners will need someplace to shop so commercial land in those areas will be very desirable when the major retailers move in.

The way to locate investment opportunities in potential rail bedroom communities is to look at the maps of the proposed rail lines. Look for land near the proposed rail stations, land that’s just a few minute’s drive from the rail stations will be the most desirable.

Look for farms, and land that’s already zoned for residential or commercial use. In particular look for properties on good roads or highways that lead straight to the train station site. Those will be the places the developers will buy up first.

Another type of investment will be lots, houses and undeveloped land in pleasant small towns with bullet train stations. Many Americans will move to small towns or the country and use high speed rail to commute to jobs in the cities once it becomes available. Some of the most valuable properties will be houses and lots within walking distance of the train station.

The way to locate these investment opportunities now is to locate the maps of the proposed lines and find where the stations will be. Then go to the proposed station locations and start looking for bargains.

Rail is the Future

Twenty or thirty years from now a lot of people will be sitting around grumbling that they didn’t buy up land on the bullet train line back in the day. Instead of being of one those grumblers, you could be the smart cookie that cashed in on this opportunity

Those who take advantage of the opportunity of real estate investment along high speed rail lines now could get in at the beginning of the next great American real estate boom.

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