Finding a good real estate market should never be an excuse not to invest.  Almost every market presents a unique opportunity for a creative investor.  Markets with low appreciation and few investors present excellent opportunities to buy cheap, renovate, rent and sell for a profit.  Markets with strong appreciation will require larger capital outlays, but allow the investor to spend less time per dollar invested.

Novice investors should maximize their competitive advantages.  Typically, people know a lot about the neighborhoods in which they live and the surrounding areas.  Little details about what block tends to be worth more than another or new plans for retail development present hyper local investors the opportunity to invest smarter and earlier then outsiders.  Do not give this advantage away by trying to invest in the “next hot market.”

Understanding where the market trends lead should help an investor formulate their investment strategy.  In some areas, renovating and leasing make sense.  In other areas, it might make sense to buy new construction at deep discounts, leases and hold for profits.  Regardless of the area, the more knowledgeable investors can be the better investment decision investors can make. 

Local investors have a valuation advantage as well.  Tracking real estate values in an area for 5+ years provides a good idea of good times to buy and sell.  Additionally, identifying long term trends can often signal market shifts and investment opportunities.  As the new mall becomes the old mall or the north side becomes younger and more desirable, it may be time to cash out of one investment and upgrade to a new area. 

Do not forget that relationship building also takes a tremendous amount of time and effort.  Getting connected to the real estate community is much easier when it’s a 10 minute trip to see an agent, accountant or lawyer. 

Regardless of where you decide to invest, you should be familiar with your local markets.  Investors should never miss opportunities close to home and should be constantly farming their local neighborhoods for like-minded investors.  Maximize your competitive advantage by knowing your neighborhood better than anyone else.