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Why are Real Estate Investors Flocking to Dallas? (2019 Update)

If you’ve been researching the best avenues for diversifying your portfolio, growing your wealth, and earning passive income, you’ve no doubt considered residential real estate investment in Dallas. While just a few years ago the nation experienced a devastating real estate crash, today investment properties for sale in Plano, Dallas, and Fort Worth are gaining worth at an incredible rate.

Demand Outstrips Supply in the Dallas Rental Market

According to Dallas News, apartment rentals present a very desirable market for investors right now. While over 35,000 apartments are currently in construction in the DFW area, the demand still exceeds the supply. Less than five percent of the area’s apartments are vacant, and despite new construction, vacancy rates continue to drop. As a result, rental fee rates have increased by approximately 5.5% in recent months.

What It Means for Investors

With so much new construction, experts currently expect rental growth to slow within the next two years, but they do not expect decreases in rental fees. All this suggests that now is the perfect moment to look into a residential real estate investment in Dallas, especially if you are interested in purchasing rental property.

When you look at the numbers, you can clearly see why more and more investors are flocking to the Dallas-Fort Worth area. The current boom in apartments and other residential investment properties for sale in Plano, Dallas, Fort Worth, and the surrounding area will not last forever. However, unlike a housing bubble, this “boom” is expected to slow, rather than burst or deflate. Thus, it makes sense for investors to place their capital now, begin reaping benefits immediately, and continue to gain wealth over the coming years.

Single-Family Homes Seeing Market Growth Too

While many investors find multifamily properties attractive – and while it can be highly profitable to pool your capital with other investors in a real estate investment trust (REIT) – this style of investment is not for everyone. Investors interested in single-family rental properties have also been finding a great deal of success here, as well.

In fact, the property values for single-family residences in Dallas and the surrounding area are increasing at roughly double the rate of the rest of the country. According to Dallas News, the average market growth in other areas of the United States is 4.2%, whereas in April of this year Dallas property values rose an average of 8.8%.

Residential real estate pricing is still very reasonable, and rental rates are expected to continue to grow in the coming months. Investors are flocking to Dallas to see larger ROIs and to take full advantage of the current growth in the housing market. Whether you are interested in investing in multifamily or single-family residences, you should consider the Dallas real estate market to diversify, stabilize, and grow your portfolio.

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Why Diversifying Investments is Important and How to Do It Right? (2019 Update)

If you’re new to the world of investing, you’ve probably heard that you should diversify your investments. You know that it’s a good idea to invest in a variety of short-term and long-term assets, but do you really understand why diversification is so crucial?

At its most basic, the idea behind diversification is protection. If your funds are spread over a range of different assets, no single market event can do major damage to your portfolio. In addition to this, if you mix long-term investments with slow rates of return with shorter-term, more volatile investments, you can effectively stabilize your portfolio in order to take advantage of those short-term investments while maintaining a hedge against an unpredictable market with your long-term investments.

Real estate is one of those long-term investments, and, in fact, it is one of the very best investments to help you both stabilize and diversify your investments. That said, not all real estate investments have the most stabilizing effects. For example, real estate trading and house flipping are both short-term investment strategies that can help you grow your wealth a great deal. However, if you already have a number of short-term investments in your portfolio, real estate trades aren’t necessarily the best additions from the standpoint of financial stability.

So, how can you diversify your portfolio and create financial stability while you grow your wealth? First, you must embrace the fact that diversification is not a one-time act. You cannot simply purchase a property that you intend to be a long-term real estate investment and expect to be finished. You must understand the balance of your investments, and you must have a plan for your asset mix. This is why so many savvy investors enlist the aid of diversified realty advisors.

When you choose how you’ll diversify your portfolio, you’ll need to decide whether you want a conservative asset mix that will lean toward preserving your funds and hedging against inflation or an aggressive mix that will lean toward rapid growth of wealth and slightly less stability. You can, of course, also choose a path that lies somewhere in between these two, and you can change your asset mix, as well, to meet your short-term and long-term goals for your portfolio.

REITs and Other Real Estate Funds are a Good Start

Of course, if you want the freedom to trade assets and make changes to your portfolio, you will need to look into how you’re investing in different markets. For example, investing in a real estate investment trust (REIT) is very much like investing in the stock market. Instead of stocks, though, you purchase shares of real estate investments that the trust purchases and maintains.

Because you’re investing in shares of real estate instead of purchasing buildings and properties outright, it is easier to buy and sell and to move assets around in your portfolio. However, do not assume that just because you decided to purchase shares with an REIT that you won’t need diversified realty advisors to help you make the purchases and sales you need to put your portfolio where you want it.

Check Up on Your Mix

Whether or not you have plans to change your asset mix, you should not neglect it. Schedule regular checkups on your portfolio and your assets throughout the year. Checking once per quarter is a good plan for most investors, though this can vary depending on your mix, the market, and your advisors’ recommendations.

Working with a real estate investment group or firm can also help you maintain the right balance in your portfolio. The real estate and investment experts employed by these firms can help you find the investments that best match your goals. With the right advisors in your corner, you can pursue growth and stability at the same time.