Investment properties are a smart purchase for first-time homebuyers. Here’s why.
My team and I work with a lot of first-time homebuyers, and part of the buying process for them is determining what kind of property is the right fit.
A common solution for many of them is to buy a condo, but if you’re buying a home for the first time, there are other options that may be better for long-term growth—especially if real estate holding is a part of your long-term plan.
I’m talking, of course, about investment properties. One of the reasons you should consider an investment property as your first purchase is the fact that interest rates are very low. Taking advantage of low-interest rates will get you into a better property.
"One of the reasons you should consider an investment property as your first purchase is the fact that interest rates are very low."
Ultimately, an investment property will only appreciate over time. You’ll be able to live in it in the beginning, then start renting it out later on as it goes up in value. Renting out additional units while you live in the property will generate passive income, and once you’re ready to move out, that passive income will help you achieve your long-term retirement goals.
With a duplex, triplex, or fourplex, you can turn the other units into short-term rentals a lot easier than you can with condos because many condominiums don’t allow short-term rentals. Owning the building gives you more control over what you can do with the extra space.
Also, you can put a lot less money down in order to buy a duplex, triplex, or fourplex. If you try to buy one after you’ve already purchased a single-family home, it’s far more challenging to put down a lower amount. Generally, you have to put down 20% to 25% for the purchase to make sense.
If you’d like to talk more about purchasing an investment property as your first property or you live in a condo and want to move into a duplex, triplex, or fourplex, give me a call and we can go over your options.
As always, if you have any other real estate questions, feel free to reach out to me as well. I’d love to help you.