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Real Estate Bubble Adding Price and Risk to Location, Location, Location Mantra


Real estate investors familiar mantra location, location, location are nervously replacing the second and third locations with price and risk. As home prices rise to new levels daily and worries that some markets homebuyers are jumping into might start to loose air, their appetite for risk is creating some sleepless nights. Tired buyers no longer consider the best location, they might not even be able to afford it, and if a second tier location offers slightly less appreciation at a lower price they'll grab it. This new willingness to compromise location and still take risks near the top of the market clearly looks like buyers are willing to reinvent a mantra entrenched in real estate lore.

After all, with all the hype about real estate weekend millionaires, wanna-be apprentices, and flipping fever who wouldn't want to jump on the real estate bandwagon? Almost everyone is talking, producing and marketing real estate mega-profits today. What they aren't talking, producing or marketing is the potential risk and economic ruin that could lie ahead for those that jumped before looking, under-researched, charged down payments or took out interest-only loans.

Homebuyers looking to purchase in over-heated markets should consider how much current prices have risen over the last year, two-years and five years. Contrast those rates with the potential pool of buyers to pay future prices along the same rates in the same markets. Will the local economy and personal income increases support spiraling home prices? Here's the bottom-line, are you willing to pay your projected appreciated sale price when you go to sell?

Today's top bubble markets are not for the faint of heart from a risk perspective. If you are new to real estate investing, be forewarned you must have a high tolerance for risk and leverage. Many newbie real estate investors rush out and buy properties with no-money-down before figuring out if they will have cash flow to support expenses. Pace yourself when buying rental properties, not everyone is cut out to be a landlord. Retain some financial liquidity for unforeseen problems.

The best defense in today's real estate market is to have a financial planner or account review your investment strategy before you jump into the new real estate paradigm. Your mantra should be location, price and risk.

Mark Nash is a nationally recognized consumer advocate for buyers and sellers of residential real estate. Author of four books including the recently released "1001 Tips for Buying and Selling a Home" Thomson 2005. Mr. Nash has been featured in USA Today, Fidelity Investor's Weekly, CBS The Early Show, Bloomberg TV, Dow Jones Market Watch, Unique Homes Magazine and The Universal Press Syndicate. His radio show "Real Estate Coast to Coast with Mark Nash" premieres on http://www.business.voiceamerica.com Wednesday September 14, 2005 9AM PST,11AM CST and 12 Noon EST. The show is looking for interesting guests including; real estate journalists, interior designers, home improvement experts, real estate attorney's, appraisers, home inspectors and celebrity's.

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Finding Structural Problems During Escrow ? Upscale Home Example


When buying and selling homes, the property purchase is often subject to a satisfactory home inspection being done. Now and then, a home inspection uncovers severe structural problems. Here's an example of a situation in an upscale neighborhood.Severe Structural ProblemsDoes the buyer walk away when there are serious structural proble...

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