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Is now a good time to invest in real estate?

The topic of real estate investment has made people nervous ever since the market went bust in 2008. It sent property prices tumbling and put a lot of people below water on their mortgages. Could we be headed that way again?

Experts are saying that there are signs in certain areas that a real estate bubble is starting to form once more. Utah, for example, is seeing a big boom in real estate thanks to the Silicon Slopes. California is having a housing crisis that's driving property prices higher and higher.

The market looks like it should remain steady through 2019 because we're still on the rising side of the newest property bubble. The trouble with any real estate bubble, however, is always the same -- eventually, that bubble is going to pop.

So, is this a good or bad time to invest in real estate? There's no easy answer. Instead, you need to look at a few different factors in your particular market. Here are the things you should consider:

  1. The driving force of the economy. If you're thinking of buying in a town where almost all the business flows from one source, you could be in big trouble if that source closes shop. Think of Lordstown, Ohio, for example. When General Motors closed its plant there, real estate prices plummeted.
  2. What's the neighborhood like? An "A" class neighborhood comes with top prices, so your best investment is in a "B" or "C" class neighborhood -- but you want to avoid areas that are worse than that -- or areas that seem to be sliding down the scale.
  3. What type of cash can you get from it? If you're looking to rent out a property, as long as you can command enough rent to cover your mortgage, you'll be able to survive a slump in value.

Whatever you decide, don't get involved in a real estate transaction without appropriate legal guidance. That's the best way to make sure you aren't overlooking something important.

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