Buying high end Real Estate
investing in luxuryHousesis often a good long term bet, but beware the short term losses. It is clear that high end Property are devaluing but no one knows where the bottom of the market will be.
Many expensive Houses have devalued by as much as 30% over the last year, particularly in places such as Dubai. Dubai luxury Property have dropped more than any other market, and the market is now being flooded with high end Homes for sale in Dubai.
The New York high end Property market is also suffering staggering losses and devaluations. No one seems to know where the bottom of the market will be.
Genuine expensive Houses will always increase|apprecieate|go up in value} over the long term, but if one is highly leveraged, there exists a strong risk element to investing in these areas. Particularly given the current economic crisis.
Sensible investors Are shying away from Real Estate as an investment, waiting to make money out of the housing crash when they perceive bottom has been reached. Where his will be is anyone’s guess at the moment. But the sensible course of action at the moment is to “wait and see.”
Perhaps the most worrying recent events are the fact that there seems no end in sight to the amount of banking losses and the governments seem intent of pouring vast amounts of cash into the hole created by the sub-prime mess.
Playng a waiting game also has risks, especially with interest rates at all time lows around the world. The only country offering higher interest rates seems to be Lebanon and India at the moment. A different kind of risk involved there.
This entry was posted on Sunday, August 30th, 2009 at 4:32 am and is filed under General. You can follow any responses to this entry through the RSS 2.0 feed. Both comments and pings are currently closed.