We sat down with 52 Properties co-founder and real estate expert Ali Safavi to talk about trends and opportunity in the marketplace.
Q: What are the biggest opportunities in real estate right now?
Ali Safavi: “The biggest opportunities are related to the microeconomy, which means the specific deal. Our biggest successes are with properties that have high days on the market with multiple price reductions, which signals a motivated seller. That way you can essentially scoop up the deal at a presumably competitive price, but also in a way that is fair to the seller.
Q: Are there any investment trends your following this year or preparing for in the coming years?
Ali Safavi: “I keep reading about how there will be another bubble, how prices will drop, etc., but in key markets, such as big metropolitan areas, I see these high prices as becoming the new normal. Obviously, there will be exceptions. However, unlike the dangerous dealings that led up to the crash, this time prices are being driven up by multiple factors, including gentrification, creating hotter markets in urban inner-city areas.”
Q: For people who are thinking of investing in real estate for the first time, how much money should they be prepared to lay out?
Ali Safavi: “I always say no more than 70% of whatever number makes them start losing sleep at night. That way they have a cushion in the event that the investment is not what they anticipated.”
Q: What sort of trends should people be looking out for as an indicator of where the market is headed?
Ali Safavi: “I am keeping my eye on commercial real estate property notes becoming due and to what extent that will affect the market if we begin to see defaults.”