Does Real Estate Investing Make Sense in 2026?

Allison Inman—she goes by AI for sure—isn't sure about real estate investing. But she's looking at her calculator, really trying to figure it out.

Where We've Been

To everything, there is a season. So say The Byrds, so says King Solomon, so goes the moon, the sun, and The Bachelor.

Asset classes are no different, and they all tend to operate in their own ecosystem amidst the larger economic landscape.

About 15 years ago, podcasts, blogs and websites started springing up to cover every topic under the sun. What used to require formal education, a library card, or ordering materials via 800 numbers from late night infomercials, was now accessible, for free, to anyone with an internet connection.

New Investors Enter the Field

The swell of new real estate investors took time to build, as the pain of the Great Recession was still fresh. Eventually, the market recovered enough that new, amateur investors were starting to make moves, fueled by genuinely helpful knowledge from places like BiggerPockets, along with plenty of hype from the many gurus who slither out of the woodwork whenever fresh blood is detected.

Several charts from John Burns Research and Consulting help to illustrate the various trends in real estate investing over the last couple of decades. Most recently, it's clear that the low-interest rate environment around the COVID era was a major driver of investment activity in the real estate sector.

Also during this time, home prices soared, up until mortgage rates rose sharply partway through 2022. The frenzy had finely calmed, and when the dust settled, we were left with record-high home prices, and interest rates we hadn't seen since 2008, when Katy Perry reported "I Kissed a Girl." And, by the way, she liked it.

Does Real Estate Investing Still Make Sense?

Some of us got into real estate investing when things were A LOT more accessible than they are today, either because of relatively lower prices, or the objectively much lower interest rates. For us, as well as anyone younger who is despairing of missing the boat through no fault of their own, the question today is, "Does real estate investing still make sense?"

Yes.

Here's why: Real estate remains the most powerful vehicle for ordinary people to build wealth.

As with any investment, the devil is in the details. Here are a few strategies and perspectives that remain as true and effective as they've ever been.

Real Estate Investing Principles and Strategies That Always Work.

• Leverage. This is what it's called when you use a loan to purchase an asset, and real estate is quite unique in this regard. Yes, there are more sophisticated ways to buy assets like stock on margin, but for most people, leverage in real estate is the investing force multiplier. This is one key concept underlying nearly every real estate purchase.

• House hacking. Using the home you live in to generate income. Many people get their start this way, and it can be as simple as buying a home and renting to roommates to offset your mortgage, all the way to buying a 4-unit (whether they're called 4-plexes or quadraplexes depends on the region and 4-unit is just easier), where the buyer lives in one unit and rents the other three.

• Short-term rentals (STR). Properties where you are renting it out for 30 days or fewer at a time (think AirBnB, VRBO, vacation rentals, etc.). Some people say AirBnB is "dead," "over," blah blah blah. It still works amazingly well in the right markets. More capital intensive, more active management time, but usually the highest dollar return if you can establish a quality STR. This involves first finding out if and how it's possible in your area, and then creating a space, marketing, and managing it well.

• Medium-term rentals (MTR or Furnished rental). In between (obviously) a short and long-term rental both in terms of capital and revenue. The nice thing about MTRs is they are rarely regulated like STRs, and they can serve as a temporary or long term solution for making the best returns on a property.

• Long-term Rentals (LTR). This is your traditional, unfurnished property with a long term lease in place. 10 years ago you could buy a place with 20% down, rent it out, and expect at least modest cashflow. Those numbers look different now, but the fundamentals are the same. You may need to put 40-50% down, but the fact that you can still borrow 50-60% of the cash required to buy an income-generating asset can still make for an amazing opportunity to build wealth.

• The Long Game. If you play the long game in real estate, it's hard to lose. Patience rewards real estate investors with exponential wealth growth through appreciation and debt pay down, at a minimum. If you want to make a quick buck in real estate, it is certainly doable, but generally both more difficult and riskier.

• Partnership. With real estate being less-affordable than ever in most markets, pooling resources with other investors whose values and goals you share can make a lot of sense, and afford opportunity when the lone wolves are sitting on the sidelines.

That's not an exhaustive list, but it's a good start for those considering if these current market conditions still make real estate investing a smart choice.

If you're in our market, in Northern Colorado, we can confidently state that this region's long term prospects remain strong, and we ourselves are still investing here, putting our money where our mouths are.

Reach out today if you are reading this and wondering where to start.

REACH OUT TODAY