Imagine you decided to get into great physical condition in 2011. It was your most important New Year’s resolution. Would you hire an out-of-shape trainer to help you achieve your goal? Of course you wouldn’t. You would want to take advice from a person that already is in the physical condition you hope to attain.
Shouldn’t the same principle apply when considering the financial risks involved in purchasing real estate in today’s market? We should want to follow the people who have already reached a good financial position in their lives.
How do we get the wealthiest people in the country to advise us as to whether or not now is the time to buy a home? It’s actually rather easy. Just look at what they are doing and do the same.
Right now the wealthiest people are investing in real estate. It was recently reported that sales of condos over $4 million have skyrocketed. Crain’s NY Business explains:
Nine apartments asking more than $4 million went into contract last week, according to brokerage Olshan Realty. The firm tracks the high-end residential market and began releasing its data to the public last month. By comparison, during last year’s Christmas week, no apartments over $4 million went into contract …
In fact, the number of luxury apartments that went into contract so far this month, 52, rose 62.5% from the same period a year ago. UrbanDigs, an analytics and consulting firm that tracks Manhattan housing activity in real-time, confirmed the strong contract signing activity for luxury apartments last week. It defines the luxury market as including properties listed at more than $5 million and found that there were 83 such contract signings this month, up 10 from a month ago.
This coupled with previous information on the luxury purchaser proves the wealthy are again excited about real estate.
If we want to make great financial decisions, we must look at what the most affluent are doing and do the same. The wealthiest are buying real estate. Shouldn’t we?