To invest or not to invest—that is the question. Maybe your friends, family members or colleagues have encouraged you to invest in real estate, but you’re still not sure if you’re ready to take the plunge. Is real estate a good investment? More specifically, are MCM homes a good investment? And how does location factor into the equation? We posed these questions to our expert realtors—Talia Freedman, Ed Murchison and Marisa Swenson. Keep reading to get their professional advice and learn more about them.
Atomic Ranch: Is real estate a good investment?
Talia Freeman: Generally speaking, real estate is a good investment. Owning a house long term is a better investment than renting long term, especially if the costs are similar. If you’re going to purchase real estate strictly as a rental (there are other ways to invest such as flipping houses), you’ll need to weigh if it’s a short-term or long-term investment and consider the market in which you’re buying. If you’re in an “up” or “seller’s” market like we are now, you will want to think long term (10-20 years) for investing. If you’re buying in a “down” or “buyer’s” market, then you might do what I call a “slow flip,” where you rent the house out until prices come back up, and then you fix it up to be able to sell it for as much as possible.
Ed Murchison: Absolutely. Over time, real estate is one of the best financial investments one can make and is the best way for most families to grow wealth. Real estate is also considered a good approach to hedge against inflation since real estate usually has little correlation with stocks and bonds.
Marisa Swenson: Yes, always! Locking in a payment that over time will go down as you build equity and eventually be paid off is better than paying rent that will be increased over time with no long-term financial benefit.
AR: Are MCM homes a good investment?
TF: Mid Century Modern homes often sell for a premium in comparison with their more customary neighbors (say, a standard Mid Century Ranch). But it’s also of interest to a narrower pool of buyers who are aficionados of the style. This doesn’t lower the value, but can add some time while you wait for that buyer who just won’t compromise on style.
EM: I think Mid Century Modern homes are about the best real estate investments. Well-designed Mid Century Modern homes have tended to command a premium of 15-20% over similar, more traditional style homes. Their clean lines, open layouts and seamless indoor/outdoor casual way of living make them a perfect fit for how people want to live today. They offer charm, character and architectural interest to those looking for a home that reflects their personal style.
MS: At the moment, yes, as Mid Century Modern homes are extremely desirable. If they are a custom home designed by an architect then even more so—it is like purchasing a piece of art. Also, Mid Century Modern homes tend to be built with more materials than what homes require today, so you typically have a more solid structure. The costs to restore and maintain tend to be higher than a traditional home, but getting to live in one is priceless.
AR: How does location affect real estate investments?
TF: I live in the Southwest United States just outside of Albuquerque, New Mexico. Understanding the wide variety of construction materials and styles in the area, such as adobe construction and pueblo-style, is important. These styles and methods might bring a higher value to a property in the same way Mid Mod houses might in some areas. There are also maintenance differences with some houses as compared to more standard construction, such as flat roofs.
EM: I sell Mid Century Modern homes all over the Dallas/Fort Worth area. Our local market, like most every metropolitan area in the country, is experiencing a super hot real estate market being driven by a record low supply of homes for sale and a high demand from buyers. Most homes are getting multiple offers and selling for over asking price within a few days of hitting the market. We are seeing some really nice Mid Century Modern homes selling for as much as 25% over asking price, with the average over asking sales price being around 10%.
MS: [I live in the] Pacific Northwest [in the] Portland Metro area in Oregon. I have lived here my whole life, and this region has been desirable for as long because of our abundant natural resources. Throughout the years where other regions experienced fluctuation in home values, the urban core here has stayed strong in equity building.
Ready to make an investment? Check out “Expert Tips For Off-The-Wall House Hunting.”
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