Investing in real estate has long been considered one of the best ways to build wealth at any stage of adult life. And with the housing market locked into lower than average interest rates and above-average sales prices, many would-be real estate investors are wondering if now is the right time to invest.
As of 2021, we’re currently in the middle of a seller’s market. And this means that sellers have the upper hand because they can charge higher prices over the value of a home. But all trends come to an end. So what’s the right move to make if you want to invest in real estate today?
Thankfully, as home prices have gone up, so have rent prices. And this is where you can make real money as an investor.
Here, we’ll detail a few of the best investment ideas if you’re thinking of jumping into the real estate world.
The price of rent has risen to over 16 percent in the past couple of years. And this is shocking considering that the average increase is generally around 3 to 4 percent annually.
But with rental prices falling for much of 2020, they are now rebounding much faster than before the pandemic began.
As such, obtaining a rental property loan has never been easier. And with the amount of rent you’ll be able to charge per month, you’ll easily be able to secure your investment without having to worry about not being able to cover your mortgage or insurance payments.
However, rentals do come with periodic upkeep and maintenance as a result of renting to multiple families over the course of a few years. So you do need to ensure that all of your property’s issues are being taken care of.
If you’re able to secure funds for a vacation rental, and you live in a prime location for vacation and tourism, you’ll be able to turn an easy profit season after season, year after year.
Additionally, with the average cost of hotel stays rising considerably since the onset of the COVID-19 pandemic, more and more people are turning to vacation rentals and the like instead of spending loads of money at costly resorts.
Vacation rentals also offer families a private vacation experience that they don’t have to share with others. This not only mitigates noisy neighbors but it’s also seen as a safer alternative to staying in hotels around other people during the middle of a pandemic.
If you have a property that sits beachfront, or if your property is located near a prime tourist destination, you’ll be in line to compete with other rental properties in the area. And this is where your own creativity when it comes to amenities and special features will attract renters from around the country and around the world.
Building a business, like investing in real estate, is seen as the American way of building wealth and contributing to the overall well-being of the local community. As a business owner, you create jobs and introduce new products and services into the market.
As such, investing in a commercial space is a great way to generate revenue because business owners all over the country are aching to get out of their basements and home offices and into a legitimate brick-and-mortar location.
Once a business has the means to establish itself, renting a commercial space is the next logical step. And with the above average cost of commercial spaces, you’ll be sure to make a nice profit from renting out these spaces to upcoming, expanding, or existing business professionals.
Investing in real estate takes time and patience and a little strategy and planning if you want to turn a profit rather quickly. But investing in rental properties will probably get you to a traction point much faster than flipping homes in 2021.