Thinking About Buying A Rental Property?
Have you thought about buying a rental property in Bakersfield? If you have, you have probably noticed that it is a good time to purchase rentals right about now. I’m sure you’ve seen the articles talking about a recession impending, but even given that fact it is still a good time to purchase rental property in Bakersfield.
Why Shouldn’t I Be Worried About A Recession?
Real estate is a long term investment. Most people look at flipping and wholesaling, or other forms of real estate investing and think that they can be considered actual “investors.” I do not feel that those are forms of real estate investing, rather speculating. It is akin to trading stock options. You are not investing for the long haul, you are putting your money into a project to get a short term return. If the market turns, it can completely remove that return.
Looking at most real estate investors, it is not about the short term. It is about the long term returns that this property can bring. Investor Warren Buffett has mentioned that one of the wonders of the world is compound interest. This means that you are in a situation with your investment that your interest earned would start earning interest as well. In order to be able to do this we need to reinvest the profits that we get from our rental properties so they can start earning more interest themselves.
I’m Still Hesitant….
If you are earning more interest on your property, and you take and reinvest that interest, regardless of time period, on a regular basis. This would be called dollar cost averaging. Another great lesson which master investors teach us. Dollar cost averaging means that we should not be worried about prices today because we are looking for investment value in the long term. We should be worried about buying good deals still, and not throwing the money away, but when we find those good deals we should execute because in the long term the thought process is that the investment will increase to a value that is going to be higher than the original purchase price, and the whole time we have owned the investment property, we would have been earning cash flow as well which should be reinvested to provide the best result possible.
We have done many deals, and continue to do many deals that return our Clients a net return of 6%, 8% or even double digits on their real estate. If you are interested in real estate investing in Bakersfield, feel free to reach out to Synergy Real Estate and Property Management.
We provide our real estate investing clients a one-stop shop service where you can be sure that you are buying a quality investment property, and having that property managed in order to preserve your initial investment capital.
Until Next Time,
Sanjeev (Sunny) Advani
3400 Panama Lane Ste J
Bakersfield, CA 93313