Will You Benefit From Owning A Home Short Term?
If you\’ve read real estate books or attended investment seminars, you\’ll hear the gurus recommend you own property for at least 5 years to get the most equity. This advice may sound logical since commission and other closing costs can deduct a major portion of your equity if it hasn\’t appreciated substantially.
But let\’s consider the downside of waiting to buy a home. When you procrastinate getting into the real estate market, you run the risk of home prices and mortgage rates spiraling beyond your ability to qualify for a home. Plus, you\’re letting valuable tax deductions slip through your hands each year you continue to rent. If you consider the wealth building potential of owning a home and the thousands of dollars in equity you could be passing up, you\’d be foolish to ignore the opportunity of owning a home.
If your future life goals include relocating within four years, try working on a short term ownership plan. Some savvy homebuyers can flip through several properties within a short time and earn substantial profits along the way. It\’s important to understand you can\’t go wrong purchasing a house-assuming you approach the process intelligently. Although the real estate market and loan interest rates oscillate up and down, you\’ll always find smart investors earning considerable equity through short term ownership.
Some home buyers are wise enough to profit from homes in need of repair. If you possess fundamental remodeling skills or at least willing to learn some basic skills, you can remodel and redecorate a property to earn thousands of dollars in increased equity when it comes time to sell.
Investing in fixer uppers aren\’t the only way to profit from the real estate market. Many homebuyers have utilized other creative means to build their profits. Some examples of profitable short term ownership strategies include locating sellers desperate to sell, probate sales, foreclosure sales, and REOs (real estate owned) when the mortgage bank takes back property after the home owner fails to make their agreed upon payments.
For some homebuyers, one of the best short term buying strategies is a lease option. If you take advantage of renting with the option of purchase a property, you can build your credit, save cash toward a down payment with your rent credits, and lock in the purchase price against future inflation of housing prices.
One great advantage of lease options is the ability to opt out of purchasing a home and selling the option for a profit to another homebuyer if real estate prices climb upward. The new homebuyer can take advantage of your pre-negotiated market price and any rent credits you\’ve accumulated.
Looking for the best Orange County home? Then check out these Glendale homes for sale and use local Glendale Realtors .
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