Wouldn’t you want to know if buying near a certain HUGELY POPULAR store that is often touted as a BONUS by sellers could actually be LIMITING APPRECIATION compared to similar retailers by as much as 10 percent? If you don’t like the sound of “always low prices” and YOUR HOME in the same sentence, you can’t miss this. I’m Carole Ellis. This is Episode 25.
So, let’s just get this out in the open. We all love the people of Walmart. Some of us have even BEEN the people of Wal-Mart if we really needed that toilet paper run at midnight! And that’s okay. Wal-Mart gets a lot of grief from a lot of different directions, and this podcast is not about shaming Wal-Mart, its customers, or even its management. This podcast is about alerting you to the cold, hard facts that if you buy property near a Wal-Mart, it could cost you by comparison to buying near other big-box retailers.
Now before we go any farther, I want to take a minute to put you on HIGH ALERT. REI Today has gained what we’re calling “first look access” to a brand new real estate training that includes, among other things, access to $600,000 in FUNDING for all types of deals. If that sounds like something that might be too good to pass up (and let’s just say, it’s not something that’s going to be available forever) then I recommend you watch this training TONIGHT, the only time REI TODAY is going to offer it, at 9pm Eastern or, for our west coast listeners, 9pm Pacific. Go to http://www.rei.today/FUNDING600 If you’re serious about jumping into real estate or escalating your business in a meaningful way, it will be worth your time to do it. This is a really fantastic program that will enable you to plug into the profitable side of real estate investing and start profiting quickly no matter age, experience level, or income. And that’s the last you’re going to hear about it, so please, don’t delay.
Now, back to Wal-Mart’s “always low prices” and how they could be keeping your appreciation always low – or at least, always LOWER than everyone else’s – as well. Here’s the deal. One of our favorite real estate data giants, RealtyTrac, has evaluated ALL THE HOMEOWNERS IN THE COUNTRY who sold their homes in 2015 on the basis of proximity to Wal-Mart and its closest competition, Target. Tar-jay to those of us who consider ourselves die-hard fans. The homeowners who lived near Wal-Mart sold for prices that equated to roughly, on average, 16 percent appreciation over the lifetime of their ownership, which doesn’t really sound all that bad, until you compare. Homes located closer to Target snagged 27 percent appreciation on MUCH higher property values for a total of…wait for it because it’s going to hurt…selling on average 72 percent HIGHER than homes near Wal-Mart locations.
Of course, there are plenty of locations – I myself live in one – where the Wal-Mart and the Target are basically next door to each other, and there are also a lot of other factors in play outside of retailer presence in determining how much homes appreciate. For the moment, however, let’s take a slightly closer look at these stores’ typical shoppers. Wal-Mart shoppers tend to be white, 50 years of age, and have annual household incomes of 53,000 or more. Target shoppers are five years younger but have an annual income that is about 12,000 higher. So it’s entirely possible that the price differences have more to do with what shoppers can afford in their homes as opposed to which retailer they prefer.
Regardless of the reason that Wal-Mart tends to correlate with lower appreciation, there is some good news: Wal-Mart homeowners tend to pay less than half of what Target homeowners pay in property taxes.
For a savvy real estate investor, this type of study is useful mainly because it simply serves to emphasize that you can never evaluate a deal without evaluating its environment. Should you remove all emotion from the equation? Absolutely. Should you remove all other external factors or trust anyone who says they have figured out a way to do so? Probably not. Always consider every angle of a deal, including the local housing trends, before sinking your hard-earned money in.
Want more information on how retail presence affects property values (or vice versa)? Check out our exclusive 2016 Housing Retail Resonance Report in the REI Today Vault at www.REI.Today/Vault. Not yet a member? Text REITODAY, no spaces, no periods, to 33444, and I’ll provide you with fast, immediate access to this report and a lot more timely information that will help make your investing safer, faster, and more profitable.
And remember, when you do that, you’ll also be able to GROW YOUR NETWORK by interacting with me and your fellow listeners to REI Today… so stop by to ask questions, make comments and network with other investors across the country. Text REITODAY no spaces no periods to 33444 or head over to www.REI.Today/Vault right now.
REI Nation, thanks for listening in and always remember this:
Your best investment is your own education.
Carole Ellis is the host of Real Estate Investing Today, a popular 9-minute daily podcast focused on educating real estate investors about the important topics that will make their investing SAFER, FASTER, and MORE PROFITABLE. She's also the editor of the Bryan Ellis Investing Letter. She has more than a decade's worth of experience in and reporting on the real estate industry and, additionally, has written dozens of courses on the topic. Carole lives in Kennesaw with her husband, Bryan, and four children. She believes wholeheartedly that your best investment is always your OWN education.