When it comes to investing in real estate – there are usually two factions that exist in the Santa Clarita investing world. One of those factions says that now is the time to buy, rennovate and flip. The other says, to Buy, Rent and Hold.
Which one is right? They both are. In fact, after working the numbers with your real estate professional, you will know the right way to go. A few questions that should be asked by your “investment strategist” when it comes to you wanting to move forward with investing in Santa Clarita Real estate are:
“Are you looking for a faster return on your money?” or “Are you seeking profits per month with better long term gains?” Talking about Tax Shelters and being able to take advantage of the breaks afforded to us by the IRS are also important topics.
Some say the time is now when it comes to investing in rental properties. More and more headlines are screaming that the bottom has been reached with regards to real estate, home values are on the rise, and new home construction is up. Another interesting piece of news is that rents are rising, and they are rising at a greater percentage than home values are rising.
Low rates and an increased belief that housing is improving have many considering that today is an ideal time to buy rental properties. Rental properties are one of the few investments that can actually pay for themselves. Consider a stock, for example. You buy a stock at one price and you sell at another, hopefully at a profit but not necessarily. If you make a profit you pay taxes on your capital gains.
Now consider a rental property. You buy it at one price, rent it out, have the rental income pay for all or part of the mortgage, and sell it, hopefully for a profit. Here you either pay capital gains or roll the property into another one of equal or greater value (1031 exchange) and avoid paying taxes. Rent has covered either part or all of your investment to-date and you can roll it directly into another investment opportunity.
As with any investment buying at (or near) the lows and selling at (or near) the highs is the best way to maximize your profits. Where we stand with real estate right now it is clear that prices are at their lows. The writing on the wall is clear, something that doesn’t happen that often, and today just might be the ideal time to invest in rental property.
Bottom line. Ensure you are getting professional advice from a Real Estate Agent that has rentals themselves. Those who are functioning in property management and rentals. Also Real Estate professionals that are buying, renovating and flipping real estate themselves. You want someone that can give you their knowledge – coupled with their past mistakes so you can not repeat them.
[gravityform id=”11″ name=”I want to learn more about Investing in Real Estate” ajax=”true”]