Gen Z is making waves in real estate 🌊

Welcome back from our short 4th of July holiday break! It’s the 2nd half of the year and it’s time to start ramping up to hit your STR goals for 2023.

Let's dive into today's top stories that are shaping the vacation rental investing landscape:

• Gen Z is making waves in the real estate market with innovative investment strategies. 🌊

• Despite a decrease in transactions, property prices remain high, thanks to a scarcity of available properties. 📉

• Treehouse rentals are offering unique vacation experiences, and they're available on platforms like VRBO and Airbnb. 🏡

• 🔥 Deal of the Day! 🔥: 3 bd | 2 ba | Molalla, OR

Gen Z: The New Real Estate Tycoons

Let's dive into the innovative strategies that the youngest generation of investors, Gen Z, is employing to make their mark in the real estate market. Despite being at the early stages of their careers and having limited capital, they're not letting these hurdles deter them from their property investment ambitions.

A recent survey by GOBankingRates revealed that a significant 42% of Gen Z is planning to buy a home within the next five years. This ambitious generation is leveraging the power of social media and online resources to educate themselves about property investment and ownership, leading to the emergence of some creative investment strategies.

One such strategy is 'House Hacking'. This concept, which has gained traction on platforms like TikTok, involves buying a home and renting out rooms to tenants to help offset the mortgage payments. This approach allows young investors to own property without bearing the full financial burden themselves.

Another popular strategy is crowdfunding. Young investors are turning to platforms like RealtyMogul and Fundrise to raise capital for their real estate ventures. This method not only generates funds but also creates interest in their projects, as donors become invested in their success.

Finally, Gen Z is also exploring Real Estate Investment Trusts (REITs) as a way to get involved in the property market without owning physical properties. REITs offer a lower-risk option, as they involve investing in companies that operate income-producing properties. However, due diligence is required to ensure they're investing in the right type of REITs.

These unconventional strategies are enabling Gen Z to start building their real estate portfolios, despite their limited income. It's a testament to their resourcefulness and determination to succeed in the property market.

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High Prices, Low Transactions: The Real Estate Paradox

The real estate market is a dynamic entity, constantly influenced by a myriad of factors. One such factor is the interplay between supply and demand, which has been particularly evident in the recent trends observed in the real estate market. Despite a decrease in the number of transactions, property prices have remained high, largely due to a scarcity of available properties.

Data from the Custer County Assessor’s Office reveals that the number of real estate sales in 2022 has declined from the previous year. However, a concurrent lack of housing inventory has kept prices elevated. This situation is not unique to the local market but is reflective of trends observed nationally.

The high property prices are largely a result of the low-interest rates that have prevailed over the past decade. These low rates have stimulated real estate transactions and have contributed to a surge in property values, which are now approximately 60% higher than they were in 2019, prior to the introduction of stimulus packages in response to the COVID pandemic.

However, the landscape began to change in the fourth quarter of 2021, when the Federal Reserve started to increase interest rates in response to rising inflation. This led to a significant reduction in property sales, which dropped to levels seen in 2018. Despite this, property values have remained near their historic highs, thanks to a substantial proportion of transactions being conducted in cash.

The current market conditions have led to a shift in buyer behavior. Unlike during the pandemic, buyers are no longer aggressively bidding over the asking price. Even occasional price cuts have been observed. Despite the decrease in transactions, builders are still busy, with many booking projects into 2024 and 2025.

The high property prices are having a significant impact on the community, particularly younger individuals who are being priced out of the market. This is contributing to a demographic shift, with the state adding the lowest number of people since 1990. The high property prices, coupled with an average household income of $60,000, are forcing younger people to move out of the Valley and out of the state in general.

The future of real estate prices remains uncertain, and this uncertainty is likely to make discussions on property taxes more challenging for property owners and their elected officials. As the real estate market continues to evolve, it will be interesting to see how these trends develop and what impact they will have on the broader economy.

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Treehouses: The Next Big Thing in Vacation Rentals

For those seeking a unique vacation experience, treehouse rentals offer an enchanting blend of comfort and adventure. These forest dwellings, available on platforms like VRBO and Airbnb, cater to a wide range of preferences, from the rustic to the luxurious. However, potential renters should carefully review the property details to ensure they align with their expectations, particularly regarding amenities such as running water, showers, and toilets.

One such captivating option is nestled in the woods of Maine. This treehouse offers a tranquil retreat from the hustle and bustle of everyday life. While it provides a rustic experience, it doesn't compromise on essential comforts. However, it's important to note that the bathroom is located just outside the treehouse, and there's no shower, so guests should plan accordingly. Despite these minor inconveniences, the treehouse's proximity to major ski mountains like Stowe, Sugar Bush, and Mad River Valley makes it an attractive choice for outdoor enthusiasts.

Another notable treehouse is situated close to Brattleboro, VT. This property offers the magical experience of sleeping in the trees overlooking a serene pond, without sacrificing any crucial creature comforts. It boasts a full bathroom and plenty of running water. In the morning, guests can take a short walk to the main house to enjoy a continental breakfast featuring locally made specialties, including artisanal bread and jam.

Whether you're looking for a unique getaway or a chance to reconnect with nature, these treehouse rentals offer a memorable vacation experience. However, as with any rental, it's crucial to read the fine print and understand what to expect before booking.

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🔥 Deal of the Day! 🔥

Address: 31497 S Grimm Rd, Molalla, OR 97038

With its charming cottage aesthetic, peaceful 2-acre lot, and amenities like a cozy wood-burning fireplace, luxurious claw foot tub, and tranquil creek perfect for fishing, this property offers a unique blend of relaxation and outdoor adventure, making it an ideal vacation rental. Check it out

Airdna data:

Estimated monthly payment: $3,800/month

Estimated monthly revenue: $5,900/month

Cashflow excludes additional operating expenses. Always confirm local regulations, HOAs and permits before purchasing a property.

That's all for today, folks! Remember, the key to successful investing is staying informed. So, keep reading, keep learning, and keep investing! 🔑