If you are thinking about getting into the real estate investment market, now is a great time to do so! With interest rates at historic lows and property prices still recovering in many areas of the country, 2016 may be the perfect time to get started in real estate investing. We’ve pulled together our top 3 reasons why now is a great time to invest in real estate – check them out below.
People will always need a place to live
As we’ve learned over the past decade, the real estate market will fluctuate, but one truth that remains constant is that people will always need a place to live and a place to call home. Some areas will have a greater need for rental units, especially if they have natural population draws like beaches, universities, or other attractions; but there are also plenty of people and families who want to live in more rural areas with larger backyards and less traffic. Whether you’re thinking about investing in a multi-unit apartment building, a duplex, townhouse or condo or a traditional single family house, it is likely that there is someone out there looking to rent. Why not let someone else pay your mortgage while you build equity and a steady second source of income?
Interest rates are still at historic lows
Interest rates on mortgage loans are still at historically low interest rates, which means that over the lifetime of your mortgage loan you will save thousands of dollars over what you would have paid in total with the rates of just a few years ago. On a $250,000 loan, the difference of just 0.5% can mean a savings of more than $25,000 over a loan term of 30 years, which is no small sum of money. Additionally, many federally-back loans programs like VA loans and FHA loans may allow you to purchase investment properties (especially if you plan to live in the property as well, such as in a multi-unit apartment building) and these programs offer competitive loan interest rates as well as features like no or low down payment options and flexible repayment terms.
Real estate investing is a flexible type of investing that you can tailor to your needs and skills
Whether you have dreams of becoming a real estate mogul, or just want to bring in an extra source of second income on the side, real estate offers investors flexible investing options. Some people want to manage large multi-unit buildings, while others are more interested in buying a duplex, renting out one side to cover the mortgage and then using that increased equity to buy a larger home, a vacation property or something else. Others are interested in purchasing a beach or lake house, but would like to rent it out seasonally in order to offset the costs of owning a second property. Whatever your motives for investing or your desired outcome, you can likely find a good match within the real estate market.