Category : Real Estate

To Rent or Buy? – A Question That Requires Careful Consideration

Everyone needs a home to live in, and it is one of the first things that people think of, once they are launched on their chosen careers. At an early stage of an earning and working life, the cost of buying a home can be high and daunting. This is the reason that many people will go in for renting a home instead of buying it.

Whether you rent or buy, in both cases, this requires the regular payment of some amount of money. When you rent, this payment is being made to increase the income of a landlord, with no other advantage to the person paying the rent, other than a place to stay in. When you buy a home, the payments that you make go towards paying the mortgage amounts that you have taken out against your home from lenders.

In both cases, renting and buying, there is often an upfront cost that may require a deposit. Rented homes require deposits that can be up to a year’s rent or some other form of security that the landlord finds acceptable. Mortgage lenders will require you to make a deposit that can vary from 10 to 20 percent of the value of a home. The higher this amount, the better terms you get for the repayment of the loan.

Renting can often be a sensible alternative when you are moving to a new town or when you change your job or career. It gives you the time to get used to the new environment and allows you the time to look around for a home that suits your circumstances. Mortgages at times can be demanding of a good credit history, and if you do not have a good one, renting can help you to have the time to improve your credit score so that you become a better prospect for mortgage lenders.

When you have your home, you are immediately liable for any repairs to it. When you rent, you only have to call up the landlord and ask for the needful to be done. A homeowner has to immediately be responsible for paying property taxes and other dues that a renter will not have to bother about. A renter may not be able to make any changes to a home without the permission from the property owner or agent. A homeowner can make any changes required, as long as he can find the finance for it.

Mortgage rates remain constant for the period of the mortgage, which can be as long as thirty years. They will change only if you go for refinancing your mortgage or want to change the terms of your agreement. This allows the person to be always in control of the financial situation and plan for it years ahead. Rents are fixed for a particular period, which is rarely more than a couple of years at the most. The rent can then be raised, or the renter may have to bear the additional cost of shifting if the new rent is beyond his paying capacity.

Payments made to landlords are lost, while payments made against a mortgage for a home that you buy, create an equity that creates ownership rights. Rents can remain a permanent drain on resources. Mortgage payments will cease after some time and leave you the clear owner of your property.

The buying of the house is an investment, and its value can always fluctuate depending on the economic situation. A bought home, however, gives the pride of ownership. Renting, or leasing is good for assets that will depreciate, while ownership is best for those whose value appreciates over time.


Things Retired Couples Need To Consider Before Buying A Property Today

When people are finally able to retire from their job, it is important to consider all of your options. One of those might be investing in real estate. You could have retired at a very early age, and this will afford you many decades in the future where you can take advantage of how real estate can appreciate. Here are the options that retirees need to consider as they think about investing in real estate after they have retired.

Is This A Good Idea?

Investing in real estate is always a good idea as long as you have the capital to work with. It’s also important to work with realtors, or other investors, that are knowledgeable about this industry. If you have a game plan that you can follow, it will likely lead to a substantial increase of money you can make on a monthly basis with rentals that you can purchase. Therefore, even retirees should consider investing in real estate.

When Is A Good Time To Start?

If you are retiring at a very young age, perhaps in your mid-50s, this is a wonderful time to begin investing in real estate. You have many decades left, allowing you to build not only a nest egg for yourself for later years, but also for your children and grandchildren. Real estate can appreciate so quickly; it is possible that you could generate hundreds of thousands of dollars in equity as a result of making these investments. There are very few investments that people can make that can amass this much return on investment.

How To Get Started

Another thing to consider is how you are going to get started. Do you want to invest in properties that you will have to fix up and flip, or are you looking for a more long-term solution? Many retirees will purchase properties that can be managed by real estate management companies who will put people into the units, collect the rent, and handle all of the problems associated with investing in rentals. The rentals can be single-family homes, duplexes, or even apartment complexes. It just depends on how much money you have the work with. Either way is going to be a worthwhile investment, even if it is only done for the span of a decade.

Where Will You Gain Access To Investment Capital?

If you are a retiree, and you have a home that is free and clear, you will probably want to use the equity that you have already built up. Some people will prefer tapping into their retirement that they can access, or other investments that they currently have which are not performing as well as they should. Real estate is almost always a safe investment with the exception of investing in properties that are in areas that are not going to appreciate in value very quickly. As long as you know how to do this, or if you are working with professionals that can manage everything for you, this is going to be a win-win situation.

Although it may seem counterintuitive to look at investing in the future after you have reached retirement age, this should be considered as a way of expanding on the amount of capital that you have access to through real estate appreciation. It may only take a few years to build up a portfolio of rentals that are generating cash flow month after month, or you may want to simply invest in properties that you can restore and sell for a much higher amount. Either of these solutions is going to yield quite a bit of revenue as a result of the efforts of retirees who are focused on purchasing real estate in their retirement years.


The Differences Between Foreclosures Short Sales And Traditional Sales In Real Estate

As you look at the many different listings for real estate in your area, you might wonder what type of property would be the best you own. You may have heard that foreclosures are one of the best ways to invest your money because you can get these properties at a substantial discount. However, some of the properties currently listed with a realtor could also provide you with a fantastic deal, especially if the owner wants to do a short sale. Let’s go over what all three of these have to offer, and then conclude on which one will probably be the best investment.

What Is A Short Sale Property?

A short sale is the sale of property for the exact amount that is owed. These people are typically almost to the point where their house is going to be foreclosed upon, and they want to prevent this from happening. Even though they will walk away from this when no money at all, you are helping them take care of the mortgage. You will be able to get the property for a very low amount, especially if there is a sizable amount of equity built into the property already.

What Is A Foreclosure?

A foreclosure is the other side of the short sale so to speak. This is where people have lost their property. It has gone back to the bank, and the bank will then sell it. The primary goal is to get some money back from this property. A bank needs to have liquid assets to function, and if all they have are hundreds of houses that are generating no revenue, this is a liability it can compromise the bank’s ability to properly function, and therefore they will sell these properties at a significant discount. You can find these at foreclosure sales, and if you are the winning bidder, you could purchase a property that could have tens of thousands of dollars of built-in equity right away. Although short sales and foreclosures are great ways to get fantastic deals, that doesn’t mean that traditional sales in real estate cannot bring a substantial profit.

Traditional Sales In Real Estate

By working with a realtor, you should be able to find many deals that are available. These will come from individuals that will lower the price that they are asking because no one is making an offer. These could be homes that are free and clear, or that have a very small mortgage. If you can purchase this for less than the market value, you will instantly have equity in that home which is going to provide you with an instant profit.

Which One Is The Best?

These ideas should help you find properties that are for sale which can be instantly equitable. Whether this is a short sale, foreclosure, or a regular property that you buy from a realtor, all of these can make you money. Just make sure that when you purchase a property through a realtor that you have done a comparable check on properties that have recently sold that are similar. This will help you decide whether or not this is going to be a good deal, and if it is, you need to complete the transaction.

Now that you have a better idea of how these different types of property sales work, you can start to look through all of them. Some businesses will show you the latest for sales that are currently available, and you can always work with a realtor to find short sales and regular properties. If you do have the ability to invest in real estate, it is something that you need to do. It’s a great way to make sure that you are moving forward toward a great retirement by obtaining discounted real estate.