“Barriers to entry is the catchphrase,” said Paul Habibi, a professor at the UCLA Anderson School of Management. “Dense cities where there is nowhere to go but up, and an inability to introduce new supply, will lead to more price insulation.” Buyers should take a broad view of a market’s economy to gauge an investment property’s potential for appreciation. “A diversified economy is helpful in that the market area is not subject to one specific industry that can rise and fall,” Mr. Habibi said. Detroit, for example, has long struggled to recover from the decline of the auto industry on which the city depended."
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