I’M NOT KIDDING!
There are two important facts that we know today relating to residential real estate in America and foreclosure property investment:
1. There is a glut of homes on the market right now in many areas of the country. In other words, we are “over-built”.
2. The United States population is projected by the U.S. Census Bureau to grow +29% between the years 2000-2030.
What does this information tell us?
First, it tells us that we currently have more homes available than we have people to buy them. Second, it tells us that this is only a temporary situation.
How do we know that? Well, if we do the math, we are going to have approximately 82 million (that’s 82,000,000) more people living in the United States by the year 2030!
And I can tell you, without hesitation, that despite being over-built today, we do not have anywhere near the amount of homes available to house 82 Million new people in this country. So, the bottom line is that we will absolutely grow out of the current “over-built” situation. The $10,000 question is: “When?”
“Depending on the “expert” opinion that you subscribe to, we will outgrow the current over-built housing situation in the U.S. in 2-3 years.”
Why is this relevant for investors interested in foreclosure property investment?
As long as there is a glut of homes on the market, the pressure on home prices will continue to be downward. This is basic economics:
Excess Supply = Lower Home Prices
So, let’s say that you are an investor considering a foreclosure property investment. Not only can you acquire homes for “pennies on the dollar” today, but you can be quite confident that the value of the foreclosed properties and reo properties will appreciate within the next 2-3 years. (Sooner, in some geographies.) The reason for this is also basic economics:
Increased Demand = Higher Home Prices
The increased demand will come from the 82 Million new people that will be added to the U.S. population over the coming years.
Q: Do you have to wait 2-3 years to earn a profit with a foreclosure property investment?
A. Absolutely not! You can earn extraordinary profits right now if you know how and where to invest in foreclosure properties and reo properties.