Investors who are looking for a stable investment in 2016 should consider investing in rental property in order to take advantage of the rental rates and property appreciation.
SoCal Superior Properties, Inc. knows that the real estate market is finally cooling off after an exciting year in 2014. Investors who are looking for investment property in 2016 should consider rental property over all other options. Those who specialize in buy and flip property should consider looking at rental property instead.
The reasons that investors should consider rental property in 2016 are because rental rates are going up, the number of homebuyers on the market are decreasing, and the mortgage interest rates are going up, while property values are likely to increase at a stable pace. Investors who are able to lock in a low mortgage interest rate should be able to take full advantage of leverage.
The number of buyers who are interested in purchasing buy and flip assets will decrease in California's hyper market during spring. Most savvy investors will purchase their assets before this high season. The investors who own rental property are likely to earn far more cash flow, than those interested in further renovations until late summer to winter but income producing investors will be able to capture the influx of tenants entering the market all year long.
Investors who purchase rental property in the beginning of 2016 should be able to take advantage of the mortgage interest rates before they go UP. Ideally, investors should be able to find a rental property at the lowest interest rate possible. The QE program has finally come to a close and interest rates have nowhere to go but up. Investors who wait until the end of the year to secure a rental property will likely be looking at interest rates that are at least one point higher.
Investors who purchase rental property in the beginning of 2016 will also be able to capitalize on increasing rental rates and property values that are likely to elevate throughout the year. Expect that rental rates in almost all markets of the United States are going to increase in 2016, as there will be more tenants on the market. Those investors who own ideally positioned property will likely find that they are able to increase these rental rates on a steady basis.
Real estate investors who are considering an investment in 2016 should take full advantage of rental property. If you'd like to start placing offers on income producing properties, in SoCal, please contact us now
When receiving real estate advice, individuals should always seek their own legal and tax advice pertaining to each persons financial portfolio.