Is now the right time to consider purchasing an investment property? Mortgage interest rates are low, and Lane County’s economic future appears solid. Follow along to learn why buying an investment property can be a terrific financial move in 2020.
What Is an Investment Property?
What is meant by an investment property? Primarily, real estate that you buy to make money is known as an investment property. You might view the investment as a long- or short-term commitment.
Do you enjoy watching the super addictive cable television house shows? If so, you are familiar with the idea of buying a property as a short-term investment. Of course, the entire house-flipping process is far more relaxed on television.
Purchasing a rental property is a more long-term type of investment. For example, the Eugene-Springfield communities have a rental housing shortage right now. A smart rental house purchase could give you a robust return-on-investment (ROI).
Commercial real estate is still another example of a long-term investment. Common types of commercial real estate include retail, multi-family, industrial, and office space. They all have benefits and downsides.
The one thing that all the above examples have in common is that they are investment properties. As Millionacres notes, the best type of investment gives you passive income, steady returns, and the opportunity to make significant profits.
What Kind of Investment Property Fits Your Lifestyle?
There’s no denying that today’s low mortgage interest rates make investing in investment property more doable. If you can’t wait to take advantage of the perks of owning money-making real estate, you’ll need to find the right kind of property. For example, do you want to buy a low-key rental house, or would you prefer trying your hand at house flipping?
The first thing you’ll need to do when shopping for a real estate investment concerns your emotions. Unlike when you search for your home, there isn’t room for falling in love with a property when it comes to an investment. You might love the piece of real estate, but there are more vital things to consider.
Some of the crucial elements of making a sound investment decision are the following.
How much money can you put into an investment? Along with a mortgage, you must remember that there are also things such as taxes, insurance, and utilities to pay.
It’s typically more challenging to get a loan for a non-primary residence property. You’ll most likely need to put together a minimum of twenty percent as a down payment, and your credit rating should be on the high end.
How much money can you afford to lose? Never forget that even the most well-planned investments can turn into duds. Don’t commit more of your financial resources to an investment property than you can comfortably afford to lose.
Here’s an informative article that discusses how to determine your risk tolerance.
Real estate professionals know the value of location. Figuring out the best type of investment property to buy in a specific place is worth every bit of your time. For instance, purchasing a potential student rental makes more sense in the West University neighborhood than in the area around Crest Drive.
Gather a Group of Professionals to Help
If you are a newbie investor in real estate, we suggest that you seek help. Fortunately, there are plenty of professionals available who specialize in helping new investors.
Examples of professionals who can guide you through the investing process include your accountant, lawyer, real estate agent, and mortgage specialist. Be upfront about your budget and financial goals as you journey through investing.
Check out the Rental Owners Association Lane County for an abundance of helpful resources. You can access educational opportunities and peer advice from people who own and manage rentals in the area.
Lastly, only you can decide if now is the right time to purchase an investment property. Don’t delay getting the advice of Lane County professionals to help you decide on a worthwhile investment.
Strategic Mortgage Solutions thrives on matching our clients in the Eugene, OR metropolitan area with outstanding home loans. Contact us today for a no-obligation appointment with one of our experienced loan officers.