Phoenix Offering Best Gains For Wholesaling Homes
According to a new report by the Financial Post this month Phoenix, Arizona is boasting some of the best home price appreciation and profits for those wholesaling homes. So just how much are investors making, and are fears of a bubble warranted or not?
According to coverage of the Phoenix housing rebound by Bloomberg and the Financial Post real estate investors are banking big with homes that sold for $273,000 in March of this year now going for $600,000. That’s on top of a 21% year over year lift in home prices since 2012, almost twice the national average.
So does the Arizona market rebound still have any gas left in it, or are we looking at another bubble forming before our eyes?
Attention seeking journalist and industry names yearning for media coverage have tried to paint the recent rebound as signs of a new bubble. Of course these sensational stories continue to leave out some of the most important facts.
Digging into the real data it is revealed that property prices dropped almost 60% in Phoenix in the wake of the bubble. While there have been significant gains recently and substantial profits made by investors wholesaling houses, the same experts admit current home prices are still 30% under previous highs.
So effectively we are only 50% of the way back to level from before the crash. Based upon historical housing cycles home values will double again during a new upward phase lasting 10 to 15 years. Based on these cycles which have been proven around the globe again and again we aren’t even really into the real boom phase again.
Plus, while housing might have been experiencing a turnaround in Phoenix for some time the commercial property rebound is just getting started. This is what will bring jobs, increase rents and demand for housing; boosting values and profits from wholesaling houses even further.
So there are still deals to be had in Arizona, especially with many of the biggest money players switching up their strategy to loan money to smaller investors rather than compete with them. And with values still more than 30% below previous highs there is lots of room for growth.
Rapidly rising prices make for the best conditions for wholesaling homes. For the bulls and even the bears that do fear another bubble, even if completely unwarranted wholesaling is a great investment strategy which lets them get in, out and paid fast.
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