The hot real estate market might have you thinking about getting in on the action. With prices steadily climbing and interest rates extremely low, it’s a great time for investing in real estate to become part of your investment strategy. What opportunities are there that can get you a great return on investment to make it make sense?
Here are six property types that could inject some rental income to your cash flow.
Second home or vacation rental
If you’re looking for a second home, it can be a great way to generate income on the side, when you aren’t staying there. Ideally located in a tourist hotspot, a vacation rental can do more than just pay your utilities. For the time you’re staying at your primary residence instead, renting it out with AirBNB or hiring a property manager to fill the vacancies can pay your property taxes, your second mortgage, and can even leave you with some left over.
Buying a condo as an investment property is also a great idea. There’s no yard to take care of and a property management company likely already operates other units in the building, so service and maintenance are simplified. Condos are growing in popularity and can be financed like any other rental property. And if you want to flip it later, buyers can take out a traditional mortgage easy enough.
Condos that operate similar to a hotel, called either a condo hotel or condotel, can be a brilliant investment as well. With all the amenities of a hotel – a concierge, housekeeping, and maintenance – they offer simplicity for a vacation rental that can be rented out with the built-in property management company. Mortgages are often harder to secure from mortgage lenders since condotels are considered non-warrantable properties, but MBANC offers condotel financing.
As the Mark Twain saying goes, “Buy land, they’re not making it anymore.” A secure investment property tends to be bare real estate, whether untouched or an infill property. There’s so much potential with land. You could build a home for yourself, build one for a rental property, or sit on it and watch the value go up simply through inflation.
Fix and flip
If you’re looking to flip properties, single family homes in any configuration can work. You can make tens of thousands of dollars in a short couple of months when it all goes according to plan, or even more if the property type and the market allow for it. Options often include mortgage interest-only payments because you’re only carrying the mortgage for a short time.
Since 1975, renting the family home has been ever increasing in the United States. While there are pros and cons for the renter, there’s only an upside for the landlord. Single family homes are in short supply especially recently, and around 45 million homes in the US are rentals with extremely low vacancy rates. An investment property loan can be tougher to secure since most lenders other than MBANC don’t consider rental income to qualify for the mortgage, but it’s a sound long-term investment.
How MBANC can help
Regardless what type of investment property you’re looking at, choosing the right mortgage lender is important. With MBANC, you can close quickly on an investment property with some of the easiest ways to qualify, get approved, and get to close. Find out more about options for real estate investors by contacting a mortgage analyst today.