You have made up your mind to buy a home, but are you sure that everything else will support you for buying the new home? Even if you go to a good realtor like Blu Skky Realty you will not be able
3 Safe Ways To Invest In A House
3 Safe Ways to Invest in a House
Investment always involves some kind of risk. Unfortunately, there is no way to avoid risk completely. You can, however, reduce the risk as much as possible. When you invest in a house, a lot of money is at stake. You want to ensure you get the most out of any investment you make, and this is exactly why it’s important to make your home purchase carefully.
The goal of this venture is to buy as low as possible, and then sell later on for more (hopefully a lot more) than you initially paid. Achieving this goal is all in preparation and timing. If you’re looking to invest in a house for future financial endeavors, then here are three proven strategies for successfully investing in a home:
1. Don’t Stress over Timing, Stress over Qualified Help
For many investors, the commonly held belief is to wait for interest rates or prices to fall. While this might appear to be a solid and smart strategy, there are some inherent flaws in this thinking.
For one, the market is completely unpredictable. Don’t believe us? Take the following as an example: from 2006 to 2011, prices in the home market fell 7.7 percent each year, and according to Fiserv Case/Shiller, 27 percent each year. After 2011, prices came back with a vengeance, rising at an annual rate. The massive difference in percentage rates was unpredicted, and both homebuyers and sellers had to weather the hands it dealt them.
As far as mortgage interest rates, they are at the mercy of the U.S. Treasury. If rates increase by merely a quarter point, you will see an increase of around $25 per month.
What’s the take away? Instead of waiting for the market to make a decision, find an interest rate and a home loan setup that works for you. One of the most valuable assets you can find to accomplish this goal is a real estate agent. They can refer you to some of the best places to seek out a pre-approved loan, and then they can assist you in finding the perfect home to invest in.
2. Do Not Buy Beyond Your Means
While it may be tempting to buy the big, luxurious home with all the amenities, remember that you must honor your financial commitment. One of our greatest recessions in recent passing was due to a glut of irresponsible lending. Do you want to risk losing your home because of a bad buying decision? If not, then you need to buy smart, which means buying within your means.
In an effort to stabilize the economy, recent government intervention has put restrictions on lenders. Gone are the days of putting half your income into the purchase of a new property. Now, you can invest no more than a third (at best) of the gross income you receive each month.
For the time being, you must stick to what you can afford, but in due time, as you make higher wages, you can start looking at bigger, nicer, and fancier home investments.
3. Think of the Bigger Picture
Owning a home for a longer duration will build equity, which is the percent in which you own the property. You can look at equity as money invested in your future. As such, you’ll want to protect your equity by doing everything you can to maintain your house. Invest as much as you can in upkeep and you will reap the benefits when it’s time to sell, as your home will stand out above all the other properties on the market.
Buying one property after the other, even with the intent to rent, will drain thousands of dollars from your wallet in closing costs. Instead, it’s smarter to settle into a property for as long as possible. In due time, you can move and put your previous residence up for rent. From there, you can expect an extra source of monthly income. As long as you play your cards right, your investments will pay off without putting you in deep water with no lifejacket.
Make your purchases wisely. Take your time in the decision-making process and know that the right opportunity will present itself. You can make a smart investment, and if you follow these three simple strategies, your next home purchase might be the most lucrative yet.
Whether it is your first home or the home you plan to retire in, I will be there to ease the process every step of the way! I find great pleasure in helping people achieve their goals in real estate a....
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