Make Your First Home an Investment Property
Most people who invest in real estate normally do not start until they have bought their first or second home. However, if you are young and looking to buy a home right now, it is a good idea to consider making it an investment property.
Making your first home an investment property goes against most people’s post-college timelines. Normally, people do not start investing in real estate until their 30s or 40s. But if you are a college graduate with a solid job, investing in property right now can set you up for a lifetime of financial success.
We have listed five reasons to consider this idea below.
1. Cheap Real Estate
There are many homes and properties that you can buy for a reduced price because it is a “distressed sale”. Distressed sales usually occur when a bank forecloses on a home and sells it at a cheaper price to get rid of it.
Buying a property like this would mean you are paying much less than the market value for it. And the good news is— there are plenty of these distressed homes for sale!
2. Another Source of Income
If you invest in a home and then rent it out, you will be able to profit off it very quickly. The money that you renters pay you will not only cover the mortgage, but also provide additional cash to reinvest in the home.
3. FHA Loans
Typically, when you buy a home you have to put at least 20% down. However, if you have not saved enough for that, you might be able to get an FHA loan.
These loans are designed to help people without a great credit get a loan for a home. However, FHA loans require you to live in the property that you use the loan for. A possible solution to this is to purchase a property with multiple units and live in one, while renting out the others.
4. Take Advantage of Your Youth
Young people do not normally recognize the benefit of being young and independent. Your current lifestyle may provide opportunities to cut costs and save, which becomes difficult later on in life. Use this time to save money and build credit. Once those are established, you can invest in real estate, and in 20+ years you will be happy that you did.
5. Change the Stereotype
Although it is not typical to start investing in real estate in your twenties, those who do, become very successful later on. It is also important to recognize that this applies to every gender, race, and identity. We believe in long-term financial security for everyone, and real estate is a solid place to start.
Where to Start:
Have we convinced you that you should seriously consider real estate investments? If so, we recommend finding a trusted financial advisor who will explain all of your options and help you make one that is best for your situation.