Finding a suitable investment in the market today is not quite a tough thing to do, especially given the booming economy. Your choice of the kind of investment to make, however, determines whether you will achieve sustainable growth or not. The real estate sector happens to be one industry that offers quite lucrative returns that may influence your choice. Investing in building and renting out properties should be quite a favorable option, given the following reasons.
Suitable mortgage interest rates
To build your real estate properties for rent, you need to probably find a suitable source of capital. Thanks to the favorable economic development today, a 30-year fixed mortgage rate hovers at around 3.7 percent in interest rate while a 15-year mortgage rate is just above 3 percent interest. This suitable interest rate for mortgages is perhaps one of the best in history. Taking advantage of these suitably low-interest rates allows you to take a manageable loan that you can pay with ease.
Favorable housing market
For the first time in many years, the housing industry is experiencing a major boost to the favor of home buyers. Finding a property to purchase within the market at a relatively fair price is, therefore, quite easy. The fair price implies that you can purchase multiple of these properties, renovate them, and put them up as rentals. The good demand for rental properties implies that your investment will pay off within a favorable duration of time.
Recession-proofing your investments
Not many investments in the market today are recession-proof. The real estate industry, especially rental properties, is one of the few that are rarely affected by recessions. With predicting a recession quite a difficult or impossible task, it is important to consider making an investment that will guarantee sustainable returns, even during recessions. Investing in rental properties will, therefore, ensure that you have a sustainable cash flow, irrespective of the economic conditions.
As a rental property investor and owner, you stand to get entitled to several huge tax deductions. For instance, any expenses that you make on property maintenances, interest on your mortgage, and property insurance can be considered for a tax deduction. Financially speaking, this implies more money in your pocket at the end of the month.