In an article titled The Investor Next Door, the New York Times discusses a new real estate investment trend. It’s condo owners buying other units where they live as rental properties. It’s approached from the perspective of the investor already living in a condo and buying others in their complex. However, it could be considered an interesting strategy for investors who are currently renting or are considering selling a home and moving.
Some investors living in condo projects are buying second and third units as rental property investments. They’re taking advantage of record low mortgage interest rates and rising rents. Demand for rent properties has been growing steadily in just about every market. With consumer sentiment about the economy and real estate at low levels and unemployment still high, there aren’t many buyers out there. And, of course there are also the many previous homeowners who lost their homes to foreclosure, and they’re renting as well.
Considering the bargain basement prices of many condominium units, rental properties with break-even rents-to-costs could still be a good investment with appreciation returning to many markets. However, with prices low and interest rates at historically low levels, it’s easy in many cases to rent the units out with a nice positive cash flow.
Couple the rental profit opportunity with living just a short walk away from your rental properties, and there is a lot to recommend this investment approach. It’s tougher when the monthly homeowner fees are high, but sometimes those fees are closely related to the amenities available, so rents can possibly offset the higher fees. The article is about New York City area condos, and in other areas of the country fees should be considerably lower, especially when there isn’t a doorman and overall living costs are generally lower.
Investors considering moving their personal residence may find this approach to be an interesting wrinkle in the real estate investment business.
In an article titled The Investor Next Door, the New York Times discusses a new real estate investment trend. It’s condo owners buying other units where they live as rental properties. It’s approached from the perspective of the investor already living in a condo and buying others in their complex. However, it could be considered an interesting strategy for investors who are currently renting or are considering selling a home and moving.
Some investors living in condo projects are buying second and third units as rental property investments. They’re taking advantage of record low mortgage interest rates and rising rents. Demand for rent properties has been growing steadily in just about every market. With consumer sentiment about the economy and real estate at low levels and unemployment still high, there aren’t many buyers out there. And, of course there are also the many previous homeowners who lost their homes to foreclosure, and they’re renting as well.
Considering the bargain basement prices of many condominium units, rental properties with break-even rents-to-costs could still be a good investment with appreciation returning to many markets. However, with prices low and interest rates at historically low levels, it’s easy in many cases to rent the units out with a nice positive cash flow.
Couple the rental profit opportunity with living just a short walk away from your rental properties, and there is a lot to recommend this investment approach. It’s tougher when the monthly homeowner fees are high, but sometimes those fees are closely related to the amenities available, so rents can possibly offset the higher fees. The article is about New York City area condos, and in other areas of the country fees should be considerably lower, especially when there isn’t a doorman and overall living costs are generally lower.
Investors considering moving their personal residence may find this approach to be an interesting wrinkle in the real estate investment business.