Usually when we read about big business real estate deals in the financial papers, the news is always about cities. New York, Chicago, Seattle, Orlando and many other urban centers are often at the focus of property. But just because it’s cities that often get the lion’s share of coverage in business news, that doesn’t mean that these are the only places worth investing in. Many people in America DON’T live in big cities, and when you look at a map of the country, you’ll see dots of towns everywhere, not just a New York and Los Angeles.
Urban Prices
One of the obvious advantages to investing in cities in urban areas is the fast turnover for sales. The dense population of cities means that property is usually in high demand. Of course, if you’re just starting out in real estate investment, this high turnover often also comes with a high cost. Buildings in cities are always going to be more expensive than buildings in towns or other rural areas.
However, for people with the available income, urban real estate investment can often lead to a lot of other opportunities in a timely way.
Slow But Steady
The one thing that properties in towns enjoy is a much lower—often dramatic—reduction in price. The price of a single floor bungalow in the city may be the same price as a multi-floor, classical Victorian home in a town. So clearly, the entry level for people that are looking to get into their first property investment at a lower cost will probably feel much more comfortable with town pricing.
Of course, the lower prices are the result of lower demand. Because not as many people want to live in a town as a city, this also means that when you sell a home for a profit, that price may not be as high, or it may take much longer to finally make the sale. However, if you can keep the costs on your renovations in control, the increase in value for buildings in towns can be substantial.
Ultimately, it depends on where you are in your real estate investment career, and what kind of resources you currently have on hand. But by talking to a hard money lender, you can increase your investment opportunities, provided that you carefully plan your project, and have a solid grasp on your figures and profit potential.