Not ready to buy a home for yourself, but want to take advantage of great market conditions? Already have a home, but want to expand your real estate and wealth portfolio? Consider buying an investment property! It’s a trend that is taking over real estate- savvy investors are looking to put their money in an appreciating asset!
Here are five reasons to consider investing.
1. Rates are crazy low.
Lower rates mean more affordable lending, or more for your money if you choose to reach higher.
2. Because it will appreciate.
According to CoreLogic, “The overall home price index (HPI) has increased on a year-over-year basis every month for seven years.” The long-term price appreciation of real estate can provide one of the safest investments out there.
3. Because passive income is good.
Yes, it’s nice to know there will likely be appreciation over time, but the real key to success with investment properties is passive income. “The best part about rental properties is that they provide a stable income,” said Mashvisor. “What would be better than having a check sent to you every month? In order to have positive cash flow, you have to make sure you invest in a profitable rental property.”
4. To turn it into a short-term rental.
The short-term rental market has opened up a new world of opportunity for investors. By buying in the right location (by the beach, near a ski resort, or in close proximity to a popular annual event, such as a music festival) you have the potential of making a significant return in a short period of time. Just be sure to check the local laws- lots of cities have been cracking down and regulating AirBnB and other services.
5. Because it can help you buy the home of your dreams down the line.
“Buying an investment property before your first home does not imply that you won’t have the funds to purchase your actual home at some point,” said Mashvisor. “In fact, investment properties that have been purchased wisely and have grown in value can offer you a sizable amount of wealth and equity.”