Recently someone approached me to ask whether buying an investment property before buying their first primary residence was a good idea, and, actually, it very well may be. Here are five reasons why:
1. Interest rates are low. Low interest rates mean greater purchasing power, which gives those looking to invest a unique opportunity to enjoy low monthly payments on their property.
2. Homes are continuing to appreciate each year. According to Core Logic’s value index, home values have increased every year for the past seven years. And, according to most experts, real estate is one of the safest (and wisest) investments.
3. Real estate investing creates passive income. Beyond just having someone else cover the expense of your monthly payments, renting out a property means that you can rely on your investment to generate passive income, as well.
4. Short-term rentals are popular right now. Even if you aren’t interested in being a long-term landlord, short-term rentals are in high demand right now. Airbnb and VRBO have opened up numerous options for investors. Your investment property also doesn’t need to be local. You can purchase a rental property in a tourist “hot spot” and have someone else manage it for you.
5. You can turn the investment into your primary residence later on. If you ever tire of renting your property out, or if you’re simply ready to become a homeowner, yourself, there is always the option for you to move into the home.
If you have any other questions or would like more information, feel free to give me a call or send me an email. I look forward to hearing from you soon.