$1.7 Trillion Waiting To Be Invested In Real Estate This Year
There are trillions of dollars waiting to be invested in real estate this year. What will you do with it?
One thing is for sure this year, there is no shortage of capital for investing in real estate. There are trillions of dollars already dedicated for investment. Billions more are likely to come available as more are drawn to real estate investing throughout the year, and previous investments pay off. Where is the money? Where is it going? What will your role in the market be this year?
$1.7 Trillion For Real Estate Investments
The World Property Journal reports that surveyed international investors say they have almost $2T to invest in real estate this year. The majority of respondents are maintaining their buying activity from last year, and are growing it. According to the report America still remains the number one, most preferred destination for global investors to put their money to work. A lot of this may go to commercial real estate and multifamily, but mixed use and portfolios of single family residential real estate are still popular too.
$7 Trillion in 401ks
The retirement investment industry is a $25T business. Some of that is in IRAs, and other types of accounts, with about $7T in 401ks. Recently companies have been concerned about individuals raiding these accounts. Some may be borrowing against 401ks to use the money as a down payment on a home (which may be done without any penalty). Others are rolling over traditional accounts to self-directed real estate IRAs for investing in income property, private lending, and more. There may be increased activity in this area this year as more look to cash out gains in the stock market before a crash, and look to put it into safer investments in real estate.
$12B+ for Financing House Flips
Lenders and Fannie Mae and Freddie Mac have been clear about their intention of blowing through caps to lend billions in mortgage loans this year. RealtyTrac reports that financing for house flips has been on the rise, with over $12B loaned last year. That’s likely to be even higher in 2017. Lenders appear to be even more aggressive now, especially when it comes to stated income loans for property investors, and unsecured business lines of credit.
Billions from Tech Startups
25 big IPOs launched in the first quarter of 2017. That includes Snapchat which hit a market valuation of $25B. Of course, while market manipulators and startup founders are cashing in big for now, many of these companies are still losing money and users, and fears of a new tech bubble keep growing. Savvy investors and tech entrepreneurs are likely to follow in the footsteps of Buffett, Zuckerberg, and Ellison, to diversify and invest their profits in tangible real estate assets. That could provide a nice bump up in activity.
What’s Your Role?
The above means trillions of dollars being plowed into the property market this year. In itself this will help to fuel more profits and gains. There are lots of opportunities, with a great fit for each individual investor. You could be a landlord, a cash buyer looking to upgrade your own home or to take on a new second home or vacation property. You could become a private lender and financing those revitalizing local communities. Or maybe you’d like to fix up and flip houses yourself. Or maybe you work in the middle and serve those on all sides as a real estate wholesaler.
How will you do it?
