Is it possible to learn how to predict real estate prices?

Learn why property values and price trends are so important.  If you can see where a market has been, and where it may be headed, you can lower your risk and improve your results.

We welcome back my good friend and successful real estate investor, David Campbell, to discuss market drivers, inflation, currency and other factors that investors should be aware of.

Enjoy the show!

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How to Predict Real Estate Prices - David Campbell
Welcome to Passive Real Estate Investing. I’m your host, Marco Santarelli. On today’s show, I have my good friend, David Campbell back. David is a good friend of mine and the founder of Hassle-Free Cashflow Investing. David started investing in real estate part-time while he was working as a full-time high school band director with zero net worth. Within six years and before the age of 30, David became a financially independent millionaire through part-time real estate investing. David has been involved with new home construction. In fact, he was one of our new home builders in the state of Texas for a number of years. He’s been involved in land development, commercial real estate and he has been focused as a professional mortgage known investor for over a decade now.

David, welcome back to the show.

Hey, Marco. Thank you so much for having me back. I love talking with you and your listeners. I’m excited to see what we learn today.

I’m excited too. I think we have a great topic. I’ve titled it, How to Predict Real Estate Prices, which is of interest to most, if not all, real estate investors. What do you think?

I think your title is very specific about real estate prices rather than real estate values, because values and prices are two different things. As an investor, when were focused on profits, it’s the increase in prices that makes us money, not necessarily the increase in value.

You’re jumping in, that’s great. Break that down, define value, define price, because for a lot of people, they think they’re one and the same. I know what you’re talking about but a lot of people are saying, “What’s the difference?”

Value is the usefulness of a particular item. For example, the usefulness of a gallon of gasoline is pretty much constant. It gets you from point A to point B by creating a certain amount of energy when it’s burned. The price of gasoline fluctuates every single day because of different variables. It could be the supply of the gasoline. It could be the demand for that gasoline. It could be the supply of the currency, which is used to purchase that gasoline, or it could be the demand or the velocity of that currency that’s used to purchase gasoline as well.

Everything you’re talking about comes down to two or three fundamental things. One is supply, and supply could be measured on many, many different things. Second is demand. The third, we’ll get to hear in a moment because we really haven’t jumped into talking about real estate specifically. Before we go down that road, I always want to start off my episodes with people talking about them. I’d like to just ask you the question, how did you get involved in real estate? Maybe you could just take a minute to talk about that, if you don’t mind?

I started looking for financial vehicles that were more powerful than trading my time for money.

Sure, Marco. When I was a high school band director, I started in the mid to late ‘90s. I was getting my first paycheck and I still qualified for food stamps. I realized that even though I was an educated, smart, college graduate,