Laguna Beach Homes: Tips for First Time Investors
Laguna Beach Homes
"Challenging" is an understatement when it comes to making your first beach real estate investment. Even seasoned investors need to take their time and make sure they're spending their money wisely. So signing that first deal can be a big step, and one that you want to get right. And in an age where you never know where the economy's going, it's even more important to think long-term and make more educated decisions. If you're looking to invest in Laguna Beach homes, here are some tips that might come in handy.
Check your resources.
As a first-time investor, you may be tempted to overstate your resources or make hasty projections - which will obviously land you in trouble. Start with an honest assessment of your resources, both in terms of available funds and the time you're willing to put into it. Don't forget to set aside a reasonable sum in advance for costs associated with Laguna Beach real estate homes for sale, such as financing and closing costs.
Do your research.
Successful investments are rarely the result of a happy-go-lucky decision. Most of them are the result of careful planning and research. When it comes to Laguna Beach homes, that means looking into various markets and comparing market trends. Are home values rising or falling in general? How big is the active inventory? How's the local economy—the job market, the population growth, the local industries?
Make smart projections.
As you probably already know, number-crunching is an essential part of real estate investing. While instinct can be useful at times, the best investment decisions are always spurned by careful calculations. Take the time you need to compare different Laguna Beach homes, make projections, and weigh the pros and cons of an investment before investing. It's the numbers, not intuition, that tells you whether a property is worth risking your money for.
Find an advisor.
In any given industry, the best way for newcomers to learn is from their more experienced counterparts. Don't hesitate to network with other investors and people in related fields, such as real estate agents and brokers. Look for someone who has the same goals and patterns as you do, but has been in the field for longer. A good mentor can give you a better understanding of the market and how to stay in the game for the long term.
Risks are a given in real estate investing, especially in a luxury market like Laguna Beach where fluctuations are fairly common. When you look at Laguna Beach homes for sale, you can't really tell at a glance which ones will bring you the best returns. Find ways to reduce the risk on your part, such as investing with partners or negotiating the sale contract. Both also entail their own risks, so it's mostly a matter of choosing wisely.
Focus on your goals.
At each step, ask yourself how your decision fits into the big picture. Will making a particular offer take you any closer to your goal? If it doesn't, there's probably a quicker way around it. Every decision counts when it comes to investing in Laguna Beach real estate, and stalling the process can only reduce your chances of scoring a profitable deal.
Laguna Beach Real Estate Trends
Laguna Beach Real Estate Trends
When comparing Laguna Beach home prices, it’s important to look at trends from both the long and the short terms. For example, average prices in the last few years—notably those that followed the sub-prime mortgage boom—have been steadily going down: $2.5 million in 2006, $2.3 million in 2007, and $2.1 million in 2008.
But looking at the big picture, one will notice that the trend is still generally upwards. From 1998 to 2008, Laguna realty almost tripled from its initial average of around $760,000. If you plan on keeping your home as an investment, analyzing from both angles can help you decide on the best time to buy and resell.
Which slice of the market are you buying into? The price of an oceanfront condo will certainly vary from a single-family home on a similar spot. The figures above are for single-family homes, which account for much of the market activity. However, Laguna Beach condos have been picking up in recent years as people opt for more practical options, even in the luxury market.
Condos have risen much faster than single-family homes in the Laguna Beach real estate market. Average prices went from just under $300,000 in 1998 to $1.1 million in 2008—a four-fold increase over the same ten-year period. When it comes to potential value, condos are a promising choice for people looking to invest in Laguna Beach realty.
A lot of factors come into play when it comes to real estate pricing. However, most experts agree that demographics and the economy have the biggest effects. The economic impact is less predictable as the numbers go up and down on a regular basis. But the effect of demographics is more stable, especially with today’s baby-boomer generation. A report from Orange Coast Real Estate shows that prices spiked up from 1987 to 1989, as baby boomers took advantage of the market, and hit a plateau for the next four years. Home buying took off again once more people became eligible for home ownership.
Taking this pattern into account, the study predicted that 2010 will bring high demand for homes as people get back on their feet, and prices are still low enough to attract potential buyers. They also expect demand to equal or even surpass 1989 levels as the market welcomes another generation of young home buyers.
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