Real estate investors invest for two types of return: Income and Appreciation.
- Income is generated from rental.
- Appreciation is generated from buying low and selling high.
The good folks at 29doors.com and turbometrics.com created an infographic about how home prices have appreciated or depreciated by state, year over year and in the past 3, 5, and 10 years. Below the image, I’ve listed a few ways that you can use the information in this infographic.
(Click on the image to view the full-sized image).
So here’s how to use this infographic.
- Valuation of current investments: This infographic helps you to compare how your real estate investment has appreciated (or depreciated) compared to other properties in the state. Have your property appraised and compare.
- Data points against other information: When you compare this data to other information about the state (economic development, inflows and outflows of people, GDP, etc.) you get an idea of the health of the state, which is particularly valuable when doing due diligence on a potential deal.
- Identification of opportunities: This infographic shows you where the opportunities are: Prices have fallen in some places and risen in others. (Note: That doesn’t mean that the fallen prices are necessarily better places to invest — in some cases, it’s a correction back to normal). The opportunities are in the disparities between how states have increased or decreased and how your target area is doing. If a neighborhood, city, or county is lower or higher than than the state that might indicate growth or soon-to-be growth area.