The real estate market is in turmoil. However, historically, savvy investors have used challenging economic times to thrive. If you have extra money to play with, you might wonder if now is a good time to start real estate investing.

Only you can ultimately make the determination. Prices remain high, but land is the one thing they aren’t making any more of – and millions of Americans are priced out of homes despite needing places to live. Is now a good time to start investing in real estate? Here are four factors to consider.

1. Educate Yourself

Real estate investing isn’t something to do on a whim. While it may seem like you can make a bundle without lifting much more than your mortgage-signing finger, you have to do your homework or risk losing a fortune.

For example, buying your home teaches you much about the mortgage market. However, it doesn’t tell you how to finance a multi-unit apartment building or keep more of your money with the right tax strategy. For that, you need insider information from people who have succeeded in the industry.

Read books and attend networking events. However, be prepared for heavy-duty sales pitches if you participate in fix-and-flip seminars and webinars. Know your budget and rehearse your elevator speech. It’s okay to say, “Thanks but no thanks; I’m still doing my research.”

2. Study Past Market Trends

If you listen to news broadcasts, you’ll soon learn even experts disagree on whether a real estate market crash looms or a more modest correction will bring today’s astronomical prices back to earth. While prices are cooling, they aren’t doing so evenly.

Your best bet is to study past market trends in your target market. If you’re new, sticking close to home is your best bet. You’re more familiar with the territory and how the economy stands in your hometown.

3. Localize Your Expertise

Another reason to stay close to home is to exercise greater control over your properties. Even the best tenant screening processes can’t weed out all bad applications, and having to travel long distances can make already-pricey eviction actions even more complex.

Furthermore, you can save considerable money by maintaining your property versus subbing out a contractor. While you probably want to hire a pro for major overhauls like roof repairs, there’s no need to incur hefty expenses to oil creaky hinges or replace weather-stripping.

4. Keep Abreast of Legislative Changes

State and local authorities take various approaches to ease the housing crisis. These measures can include rent control and limits on property use – vital information to know if you plan on converting the residence to an Airbnb.

Before you part ways with your money, read up on proposed legislative changes. You don’t want to bite off more mortgage than you can chew, only to discover you can’t charge sufficient rent to cover the costs. Perhaps it's best to wait or target another market area.

How Do You Know When Is a Good Time to Invest in Real Estate?

Millions of Americans face a housing crisis, but those with sufficient capital and credit can cash in on market changes and potentially earn a giant payoff. However, doing so requires the right approach. Is now a good time to start investing in real estate? The answer varies for every investor, but keeping the above four factors in mind can help you make the right decision.