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Is 2022 a Good Time to Invest in Real Estate?

Christina

June 17, 2022

The past few years have shown that anything can happen in the market. With the ups and downs that have characterized the market recently, finding a solid, secure place to invest our money can be difficult.

Generally speaking, real estate is one of the safest investments you can make. Property is almost always in demand, so while the market may veer into volatile fluctuations, real estate can provide a secure place to make your investments.

But when it comes to safe investments, you should always make sure you’re entering into a situation that you feel comfortable with—even with real estate.

Preparing To Invest in Real Estate

Here are a few ways you determine if 2022 is a good time for you to invest in real estate.

  1. Assess your finances
  2. Ask a professional firm for advice

So how can you know if you’re investing in real estate at the right time? There are a few ways to make sure that you’re taking precautions with your money.

Assess Your Finances Before Investing in Real Estate

The first thing you should do before you consider investing your money is assess your finances.

Real estate investment can be a great way to get consistent annual returns that build your wealth. But you shouldn’t invest money if it puts you at an immediate financial disadvantage. Investing your money in real estate may involve more illiquid assets. Illiquid assets can be more difficult to retrieve your money from your investments.

Look over your finances and determine whether or not your finances can sustain a withdrawal of funds for investing purposes. This all depends on where you’re at in your financial journey. 

At any level, you should take out a proportional amount that leaves you with enough resources available that you comfortably continue without added stress on your bank account.

A financial advisor or real estate investment firm can help you reach a number that works for you. 

Ask a Professional Real Estate Investing Firm for Advice

If you’re uncertain whether or not it’s a good time to invest in real estate, ask someone you can trust to know the answer. Professional firms wouldn’t be professional if they didn’t have a comprehensive grasp of market trends and economic factors that drive real estate investment.

At Christina, we’ve been in real estate investment for 40 years as a sponsor and manager, developing some of the most hyper-properties in the country. Over that span of time in such a competitive market, we’ve seen it all. When you come to a firm like ours, you can trust we know a thing or two about the right time to buy.

Our strategy is founded on finding the perfect moment to go in on valuable real estate assets, always informed by the property’s future potential. With our strategy concerned with the future potential of our assets, you can count on our judgment about buying property in 2022.

See for yourself how our strategy guides the properties we buy and the time we buy them. By checking in with real estate investment pros, like 

How to Find Out For Yourself

The real estate market is guided by economic trends that will let you know if it’s the right time to buy. Here are some economic indicators that help determine if it’s a good time to buy real estate in 2022.

  • Find out the job growth rate
  • Find areas of population growth
  • Research the rental demand
  • Look for areas with rising inflation

Though the professionals may have a more educated view on market trends, the information that will tell you if the market is good to buy or not is out there at the end of the day. All you have to do is know what to look for, then do a little research yourself.

Find Out the Job Growth Rate

Job growth is one of the most substantial signs of a healthy economy and is a good sign that you should get into the housing market.

Job growth, whether it’s in a particular city or nationwide, is rich information about the real estate market’s potential.

With more jobs in a given area, the more money there is flooding the local economy. This encourages growth and development in all sorts of areas, not least in the real estate market. With more jobs in the area, people will need long-term housing. Residential housing will increase in value.

Growing employment means people are becoming more upwardly mobile, which translates to a higher demand for new housing. When people can afford an upgrade to their living situation thanks to a new job, the real estate market grows alongside it.

Commercial real estate is just as explosive in a high job-growth economy. A more robust job market in a given area indicates that businesses are performing well and expanding. Commercial real estate owners who lease their properties to businesses can rely on their tenants to pay their rental income.

When there’s job growth in a particular area, you can count on the real estate market to grow too. The earlier you get in, the better the return on your investment.

What’s the Job Growth in 2022 So Far?

2022 has seen promising job growth across the nation, meaning it could be a good time to look into real estate investments.

Coming off the COVID-19 pandemic, many people took the opportunity to find new, better-paying lines of work. The unemployment rate nationally has almost returned to pre-pandemic levels.

The country is getting back to work, which could strongly indicate that more and more people will be looking into real estate.

In addition to the falling unemployment rate, 428,000 nonfarm jobs were created in April this year. Industries sectors that led these gains included hospitality, leisure, warehousing, manufacturing, and transportation. 

April’s gains follow 431,000 jobs added in March and a whopping 678,000 in February.

Find Areas of Population Growth

As you can imagine, more people moving into a particular area means a higher demand for real estate. Like job growth, population growth is a key indicator of the economic prosperity that makes real estate a bankable investment.

More people moving into an area means more competition for housing. Residential properties will increase in value when an area undergoes population growth. As the population rate rises, you can expect the housing price to increase as well. It’s wise to invest early in an area experiencing population growth.

Alternatively, if fewer people are moving into new homes, prices for residential properties will go down. While this can be a precarious time to invest in real estate, falling prices can also be a blessing in disguise—property becomes cheaper to buy.

What Cities Are Growing in 2022?

On the heels of the 2020 census, informative population data points to population growth trends in cities across the US.

Some of the countries fastest growing cities include:

  • Austin, Texas
  • Orlando, Florida
  • Houston, Texas
  • San Antonio, Texas
  • Dallas-Fort Worth, Texas
  • Charlotte, North Carolina
  • Phoenix, Arizona
  • Charleston, South Carolina
  • Provo-Orem, Utah
  • Salt Lake City, Utah

Cities across the US are getting fresh renewal of population boosts that make them bankable real estate investments in 2022. Finding the right kind of real estate market to invest in can be as simple as looking at a city’s population growth.

Research the Rental Demand

Researching an area’s rental demand is one of the clearest indications that local real estate is ripe for investment in 2022.

Unlike population growth and job growth, rental demand is directly associated with the real estate market. That being the case, one of the most transparent pictures you can get for real estate investment opportunities for income-generating properties is by looking at rental demand.

Rental demand generally pertains to residential rentals instead of commercial or industrial properties. However, these real estate types can also be high in demand—they just tend to follow different trends.

Rental demand combines many different metrics that determine a given area’s competitiveness for rental properties. Assessing an area’s rental demand is simply a matter of doing a little research into these key indicators.

The number of listings, for example, gives you critical information about the overall pool of rental properties. Demand is heavily determined by supply. In the case of rental demand, the number of properties available for rent, as seen through local listings, lets you know the area’s supply. 

Fewer listings mean more demand for rentals which translates into a more lucrative real estate investment.

Where is Rental Demand High in 2022?

Cities with growing populations result in higher rental demands. If you see population growth, rental properties will be a bankable asset for investment.

However, rental demand doesn’t need explosive population growth. High-demand cities like Los Angeles have historically been extremely reliable because of their high-value neighborhoods. 

Rental demand is higher than ever in the L.A. area, which means it’s living up to its reputation as a consistently hot real estate market.

Christina has been investing in L.A. properties for over 40 years. We’ve compiled a portfolio of hyper-prime assets and high-return properties in Los Angeles’ most iconic neighborhoods in the Westside region.

Check out some of the most high-value assets that make our portfolio so effective.

Look for Areas With Rising Inflation

While rising inflation can stress the economy at large, an investment in real estate can actually thrive amidst rising prices.

Real estate is often utilized as an effective hedge against inflation—an investment that offsets losses in the economy at large.

The prices of goods, services, stocks, and bonds rise during inflation because the dollar’s purchasing power becomes weakened. Even retirement savings can be affected by inflation, as the money saved up in your fund becomes weaker as inflation rises.

Rental income from investment properties can endure inflation, affording the secure assets you can rely on despite economic turmoil. As prices rise, expenses bills for rent follow suit. The rental income grows with inflation, which means real estate assets don’t depreciate as inflation increases.

Inflation is on the rise in 2022

As you might already know, inflation is becoming a pressing issue in the US and abroad. We’re still emerging from the coronavirus pandemic; supply chains haven’t fully recovered, which affects the prices of goods; conflicts overseas have disrupted global trade and continue to affect home prices.

The consumer-price index measures inflation across sectors. March had the highest CPI in four decades, an 8.5% annual increase in overall prices. April saw a modest decrease to 8.3%, but the effects of inflation are still clearly present in the US and internationally.

Real estate investment is the best way to ensure you can avoid ballooning prices and the depreciated value of your savings. If there’s one indication that 2022 is an excellent time to buy real estate, it’s rising inflation.

Bottom Line: Invest with the Best

For over four decades, Christina has seen everything, all the ups, and downs that the market offers. We have a proven record of high returns on real estate investments by buying high-value assets at the opportune moment.

2022 is increasingly becoming a great time to invest in real estate. We’re ready to get you on board with an investment strategy that seizes this moment.

Get started with Christina today.

Sources:

The Employment Situation – April 2022 | U.S Bureau of Labor Statistics

March Jobs Report Shows Strong Gains | New York Times

February Jobs Report Shows Another Strong Gain | New York Times

The Fastest Growing Cities in the US 2022 | University Magazine

Consumer Price Index | U.S Department of Labor Statistics

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