Education and news for smart DIY landlords!
Are you still wondering whether you should invest in real estate today? Well, real estate remains at the top picked investment to-date. If that reasoning isn’t enough, here are more points to consider and help you decide whether to buy and sell a home for profit. Don’t worry, along with these points are possible conditions you should look out for to secure a profit.
Since the pandemic began, the economy has been experiencing a downturn. Mortgages are having lesser demands due to stay-at-home orders and the slow falling of the real estate market. There is also an interest cut made by the federal reserve.
The Pros: Homebuyers or investors with good credit scores can easily buy or loan homes with a marked-down price and a reduced fixed-rate.
The Cons: There are also fewer people with good credit scores and these lending agencies aren’t likely to lend money to them. The double-digit unemployment rate also reduces the homebuyer’s market pool.
Commercial real estate investors shouldn’t worry about rent payments. The unemployment rate is still at double digits, but the CARES Act is still in effect. As an official recession is declared, calls for a second round of the stimulus package are heightened. There is also a solid chance that the package amount increases.
The Pros: Unemployed tenants are given a lot of chances to pay current and delayed rent with a capping amount of $6,000. See more at the proposed HEROES Act.
The Cons: It’s your tenant’s decision whether to pay you or not and you cannot evict them during the pandemic.
The coronavirus pandemic remains unpredictable. We could have a drop in infection rates that would lead to the easing of restrictions today. Or we’ll have infection-rate spikes tomorrow that would prompt a lockdown again. This makes other investors doubt how the real estate market will play out in the future.
The Pros: Competition is scarce and you’ll have more opportunities to look for properties to invest in. If you play your cards right, you’re bound to find the investment that can bring you a lot of money.
The Cons: A lockdown might return and your investment might sit for too long on the market.
States are slowly reopening and lockdowns are being lifted. With strict public health guidelines in place, a lot of people are going back to their jobs. For real estate investors, it is now possible to host open houses for buying and selling homes as long as social distancing is observed.
The Pros: People are now back to working at field jobs which puts the housing market back on track.
The Cons: It might take time for homebuyers to really afford a home. If you buy a home too early for investment, you might find yourself in real estate hot water.
While not all adults are unemployed, some are still given the luxury to work at home. This is a good indication that some can still afford to buy homes.
The Pros: Remote workers from urban areas are likely to look for homes in the suburbs to move from highly populated environments. Field employees might also look for urban housing due to reassignment or re-employment.
The Cons: Prospective tenants and homebuyers may not be able to afford your price or rent immediately. You must set your price fairly to attract buyers and renters.
To predict if your real estate investment will be successful, look for areas where the demand is high and there are a lot of people who can afford a home. Pay attention to locations where jobs are opening for laborers. And, find places where loans are easily given to homebuyers with good credit scores.
For more real estate investment tips, check these articles:
If you’re ready, make Landlord Prep your go-to resource for landlording education. Here, we offer a complete DIY landlording course to get you on the right track. Join our academy today. If you want, you can check out Flavia’s real estate investing webinar first!