Age is on your side
Being young allows you to make your own rules and live your life a little more freely but even that can get old after some time. The money you spend going out every other day, travelling and having fun could be put into better use. You can save this money while also building your credit and these will all help when you need to qualify for a mortgage. Since most of your expenses at this point are optional, you’re in a better position to cut back and save compared to when you’ll get older. This allows you to save enough to have money for the initial deposit.
Real estate is affordable
Real estate prices are on the rise but there are many bargains to be had because there are many distressed sales that you can take advantage of in the market. When a bank forecloses on a home, they may be willing to selling it at a loss just to clear their books and this is what is known as a distressed sale. Distressed sales can bring down the cost of all other properties in the area and you can benefit from this. This will allow you to buy a house for much less than its market value and this will be good when prices rise.
New income stream
When you purchase property with the intention of letting it, you’re investing in a new revenue stream that will start to pay off when you get tenants. You can use the proceeds from this income to cover various costs such as the mortgage and other bills or you could save it and use it to put a down payment on another property so you can expand your portfolio.
Normally, you’ll require a 20% deposit when you want to purchase a home but you can use an FHA loan to purchase an investment property. FHA loans are targeted towards people with bad credit to give them a chance of owning a home. The catch is that if you buy property using an FHA loan, you have to live in the property that you want to purchase. A simple way to get around this is to buy a property with up to four rental units. You can live in one of these units while letting the rest.
Research Institute for House America released a report that said over the next ten years, 36% of the growth seen in housing will be because of immigrants. This is because many immigrants have a strong desire to become homeowners.
More people are out to become homeowners and this is a good time to make the most of this demand. There are many properties that you can buy in various neighbourhoods that have a strong potential for growth in the next few years. If you’re thinking that investing in real estate is something you’d like to do but you don’t know where to start, start by talking to a financial advisor.