Investing in rental property ownership can generate a significant amount of income. However, you first need to understand why it is beneficial to pursue this type of rental property!
Very rarely in history have there been times that we see 30-year fixed mortgage rates stay around the 3.7-3.8% range. Same goes for when we see 15-year mortgage rates stay right about the 3% range. Due to this fact, this makes the benefit of buying rental property very apparent.
Due to the fact that mortgage interest rates are so low, it is now a viable option to look at interest-only loans. The upside about these loans is that the monthly payment goes down because of the fact that you wouldn’t be paying down principle. These loans allow each unit to become more profitable, which makes your life less stressful during the early years of real estate investments when there is a tighter budget due to the more limited inflow of cash.
For the first time in years, the housing market is cooling. Odds are, you’ll be able to find a property in your area at a fair market rate, where you’ll at least be able to use the rental income to pay off your mortgage and still have some profits from the rent payments alone.
While it may be nearly impossible to predict the next recession, it is important to know how it will affect your rental property.
Even though the previous three reasons as to why you should invest in rental properties focuses on the current market conditions, it should also be noted that rental property ownership is more often than not one of the better long-term investments to pursue.
When you have a rental property, you now have two options when making money: the money that you get from rent bringing in a total profit each month, as well as your home’s value that grows.