For those looking to purchase Real Estate properties to offer them as traditional rentals or rent to own homes, we have a few tips that you may find useful in helping you choose which properties are best suited for you.
- Good city rental locations include homes close to: downtown areas, universities and colleges, and near public transportations. These locations may have a higher turn-over than other rentals, but the property should always be rented on a continual basis.
- A good indication that a certain area is growing include: the establishment of government offices, an increase in the number of stores and restaurants being built, as well as an increase in industrial facilities. All these indicate that there is an increase in demand in the area which means an increase in job rates in the near future.
- Another clue that the areas is growing: Vacancy rates are dropping. This is a great sign!
- Plex properties are generally more profitable than single family homes.
- If you are looking to keep the property long-term, stay away from properties that require major renovations.
- Complete your due diligence. Always research the property as well as the area in the following topics prior to purchasing an investment property: Market trends, growth, population, and proximity to large centres and transportation services.
Tuesday, May 25, 2010
Friday, April 23, 2010
Is Rent to Own right for me?
Many situations suit themselves to Rent to Own. Often, they come as a result of timing and a slow real estate market. One such scenario occurs during a typical sale and purchase:
The homeowners decide to move. They list the property and put up a 'For Sale' sign. While they wait for offers to come in on their current home, they find a new home and buy it. The closing date on the new home comes and goes but the first house languishes unsold. The homeowners are stuck making mortgage payments on two homes until they find a buyer.
Even when homeowners haven't already purchased and moved, Rent to Own may be a convenient option. Many homeowners don't wish to commit to a new home until the 'Sold' sign goes up on their existing home. In a sluggish market, if a listing sits on the market for 60 days or more without bringing in an offer, a Rent to Own contract can speed up a move.
The Rent to Own option can save the day when a job transfer calls for an immediate out-of-town move. It gives families the flexibility to move quickly without leaving behind a vacant house. Because the sale is delayed, real estate market ups and downs play a smaller role in the selling price.
Rent to own makes sense when there is no rush to sell the property, allowing the seller to ride out existing market conditions.
Long-time homeowners who have accumulated significant equity in their property make good candidates. They can afford to purchase another home without selling their current property.
When the seller has little or no equity in the home, rent to own can deliver an eventual profit through the appreciation of the property, while through a traditional sale, realtor's commissions can result in a loss.
If the current value of the property is lower than the price paid, rent to own can help the seller weather the market conditions and allow the home to regain part of its value. This is only a good decision if the seller can cover the difference owing.
The homeowners decide to move. They list the property and put up a 'For Sale' sign. While they wait for offers to come in on their current home, they find a new home and buy it. The closing date on the new home comes and goes but the first house languishes unsold. The homeowners are stuck making mortgage payments on two homes until they find a buyer.
Even when homeowners haven't already purchased and moved, Rent to Own may be a convenient option. Many homeowners don't wish to commit to a new home until the 'Sold' sign goes up on their existing home. In a sluggish market, if a listing sits on the market for 60 days or more without bringing in an offer, a Rent to Own contract can speed up a move.
The Rent to Own option can save the day when a job transfer calls for an immediate out-of-town move. It gives families the flexibility to move quickly without leaving behind a vacant house. Because the sale is delayed, real estate market ups and downs play a smaller role in the selling price.
Rent to own makes sense when there is no rush to sell the property, allowing the seller to ride out existing market conditions.
Long-time homeowners who have accumulated significant equity in their property make good candidates. They can afford to purchase another home without selling their current property.
When the seller has little or no equity in the home, rent to own can deliver an eventual profit through the appreciation of the property, while through a traditional sale, realtor's commissions can result in a loss.
If the current value of the property is lower than the price paid, rent to own can help the seller weather the market conditions and allow the home to regain part of its value. This is only a good decision if the seller can cover the difference owing.
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