Based upon what Ken McElroy, author of ?The ABCs of Real Estate Investing? says, a hot market is an area that is in short supply and high demand. For instance, if there is a parcel of land on the riverfront that seems to be unattractive, but is capable of being, that may be a piece of hot property. Often, even highlyexperienced people will be unable to distinguish what is in front of their own eyes. If an investment property is overgrown, for instance, or needs a facelift, it may not up here to be a good deal to someone who doesn't know what to look for. But the very fact that it is on the water, a place where people want to be, makes it worth having.

Another kind of of hot property, according to McElroy, is a property with personality. He mentions the Venice Beach area of California, which was featured in a movie called ?Lords of Dogtown?. This is a tough, edgy spot full of surfers and skate boarders. It's ?hip?, and the fact that someone lives there says to the world that they are groovy, tough and artistic. If you can buy a piece of property around there, there is instant interest, simply by virtue of the ?cool? factor.

Not all areas have personality, however. But they may have other things, like existing industry, or a big box retailer on the way. Big companies bring jobs and jobs bring more people, who need places to live. If people are moving in from out of town, they are most likely feeling pretty positive-minded, looking forward to a new lifestyle in a new location with a shiny new job. Their positive outlook can work in the investor's favor.

Military bases increase the population as well, and not all military personnel live on base, as McElroy. points out. He also warns, however, that investors should be careful when counting on military bases, because military budget cuts can sometimes mean the closing of such facilities.

Plain old visibility can also qualify a property as hot, or at least up it's ?hotness? factor if it is indeed a advantageous place to live. Lots of drive-by traffic can be a positive thing. Drive-by traffic is free advertising. It also means that there are already plenty of people around the property, and probably that the property is on the way to work for a lot of people. Perhaps it would be a closer journey for some people, which is a good thing.

What it comes down to then, is that a hot market is property where people are. If the area enjoys a big population, or is looking forward to an increase in that population, it means there is a stable economy, and a good economy is what will maintain your investment property business.