Is this a good time to get into real estate as an investor?
To begin with, prices are low and will probably only go up for the next 10 years. Interest rates are ridiculously low. And, it’s a buyer’s market meaning that, because so many homes are on the market, you can get really good pricing when you buy.
Where do you begin?
Well, what do you want to own? Do you want single family homes? Condos? Trailers? Apartments? I recommend starting with single family homes because you probably have more experience with houses having lived in one. You have some idea of costs and upkeep. You have some idea of how long a roof or hot water heater lasts. You have some basic understanding of single family homes. You also have your largest market for selling with a single family home. Most of the population wants a home with a yard in a neighborhood so that’s where you’ll find the most buyers or renters for your property.
I don’t recommend starting with apartments or multi-units (like duplexes) because of the added costs involved with larger units. Can you afford to replace the roof on an apartment complex? Where do you want to own? Extremely important to determine. Start where you live. You know your own neighborhood. Do you want to own there?
What price point do you want to own? How many months can you afford to pay on a vacant property? When we began buying rental properties, I determined that I wouldn’t buy in neighborhoods where I wouldn’t live. If I don’t feel safe collecting rent there at night, I don’t want to own there. Next, I determined that I didn’t want to own anything over $100,000 because I couldn’t keep up the payments on anything more expensive if it was empty.
So, if you decide to start investing in real estate, start by determining your buying criteria: what do you want to own; where do you want to own it; and why did you make those decisions. The why is always important. As you go along, you can’t alter your course if you don’t know what path you’re on.
We offer classes and coach real estate investing in our local area and people constantly ask, “is this a good time to invest in real estate?” 10 years from now you’ll be kicking yourself if you don’t start.
What’s your opinion?