When is the Right Time to Buy and Hold Real Estate Investments?

Posted on December 28, 2017

While every successful real estate transaction includes a timeliness factor for both buyer and seller, there are often benefits for owners willing to hold onto properties for longer periods of time.

Owners should asses many financial considerations, including taxes, potential sale price, and a comparison of the yields that could result from exchanging, selling or holding a property.

Simultaneously, owners need to evaluate the other, non-financial consequences of holding property for an extended time, including the maturation of and predictions for the surrounding area (are the demographics shifting?), how that aligns with investment goals and whether or not there are alternative properties that are more attractive or provide the potential for similar returns without sacrificing risk.

Educated real estate investors must think about these decisions in the same way they consider other investments. While some investors enter into deals for a quick profit, buy and hold investors must be committed to a property for the longer haul. In these instances, there is often the potential to generate profits during the holding period (i.e. raising rents), but owners must be patient.

Buy and hold investors can often find opportunities to use the equity from a portfolio investment to finance other investments, although this does come with some risks.

The determining factors all lead back to an investor’s goals and selecting the best strategy to support that.

The team at Orion works with investors, developers, property owners and brokers through all phases of real estate transactions, from strategic planning and analysis to financing, negotiation, property management and disposition. For more information, call (305) 278-8400 or email info@orionmiami.com.