News About Properties

Diversification secret to success in property investment

It was late November in 2005, and Dan and his wife saw what they thought would make a good holiday gift to themselves within a year or so. They picked out a condo they liked, that seemed like it would return a handsome profit in short order.

After running the numbers over and over for the next few weeks, they convinced themselves that they had made the right decision. So they bought three more virtually identical condos in the same location.
I was telling Dan’s tale to Connie, my friend and a real estate investor. “Once you convince yourself that you have made the right decision,” said Connie, “it is natural to try to multiply that.”

In one condo association I studied, at least four couples made the same move that Dan and his wife did. They each bought four condos. Others bought three of the same; still others bought two of the same. Now there are 48 of those you-can’t-miss-with-these condos on the market at the same time.
Similar investment strategies showed up all over the place when I started looking. That doesn’t mean they won’t be good purchases for others. It does mean that the buyers in this market might want to choose a different investment strategy.

Ready to Buy a Business Property?

While residential real estate slows, the commercial market remains fairly healthy. Is now the time to buy?

Some entrepreneurs are content to rent space for their businesses year after year, but others have been anxiously watching the residential housing market, hoping for an opportunity to take their commercial lease dollars and turn them into long-term equity in the real estate market. But will the residential bubble’s slow leak (or impending collapse, depending on whom you talk to) make the next one to two years a good time to purchase commercial space?

First off, know that the residential and commercial markets don’t move in tandem; while the former has slowed dramatically, the latter is still fairly robust. The commercial market also depends heavily on the particular region and type of product. While office and industrial properties are expected to see improving market fundamentals in 2007, for example, the retail market has seen some overbuilding, leading to a softening on that front, says Rick Davidson, president and COO of Coldwell Banker Commercial Affiliates Inc., based in Parsippany, New Jersey.