Summary: Our very own Kathy Fettke was featured on the Real Estate Guys Podcast earlier this week, “Forecasting the Future in 2019”. In the interview, Kathy discusses her predictions, investing strategies and the best areas to buy real estate in the coming year.
Kathy shares that 2019 is the year to get into Opportunity Zones. There’s only a short window for investors to get in on these Opportunity Zones and take advantage of the new tax breaks. Regardless of the global economy, there are always certain cities and companies that are thriving and will thrive through a recession or a boom. Next we’ll discuss the two things real estate investors should keep in mind for 2019.
Pay Attention to Jobs
The first thing investors should keep their eyes on is jobs. Where are jobs going and where will they stay? Follow the right kind of jobs and pay attention to where they’re headed. Look for areas where new infrastructure is happening, like city revitalization, new freeways, hospitals, jobs, etc.
Getting into areas that haven’t quite “popped” yet, allows investors to still buy cheap real estate and gain equity because of all the money (i.e. jobs, entertainment) coming in and improvements being made.
Designated Opportunity Zones are areas where national and local governments want to see improvements and revitalization. Investors want these areas to be gentrified in 10 years because that’s when we can take advantage of the tax benefits.
For example, don’t buy in the middle of the Nevada desert, where there’s no job growth or much of anything going on. If we’re not seeing jobs grow in areas, then it’s not going to improve within 10 years.
Now, here’s the kicker. Buy and hold an investment property in an Opportunity Zone for 10 years and enjoy paying no federal taxes on capital gains! For additional information, here’s a map of designated Opportunity Zones.
Keep an Eye on Corporate Debt
The next important thing to keep your eye on is corporate debt. The returns we’re seeing in the stock market are based on massive debt that companies may not be able to be pay off. What will happen if these corporations can’t pay off their debt?
Invest in areas where corporations have good balance sheets, and aren’t going to go out of business.
Two key things for real estate investors to pay attention to in 2019 is job growth and corporate debt. Stay up-to-date on these trends and take advantage of new tax incentives by investing in Opportunity Zones. For more information check out Kathy’s recent article on 2019 Real Estate Predictions.