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  • How To Invest In Real Estate In A Down Economy

    The real estate economy has hit rock bottom.  There are thousands of foreclosures all over the United States.  States such as California and Florida have found that their foreclosure ratio has reached epidemic proportions.  All across the country people are finding it more and more difficult to get by.

    The United States is experiencing the beginning of a recession.  Things will get worse before they get better.  They will, however, get better.  They always do.  You just have to be willing to wait it out.

    If you want to invest in real estate, this is the perfect time to do so.  With the mortgage rates being lower than ever before and the housing prices also at rock bottom, there are so many opportunities to make a good investment in the real estate market.  This includes buying property for both residential use and to let out to tenants.

    Everyone is affected by a collapse in the residential real estate market.  It starts a chain reaction that has really just begun.  People begin to be laid off in the trades and stop spending money on entertainment or new cars or furniture.  The effect on everyone is astounding.   The real estate recession is like a virus out of control.

    You should always look at your home as an investment.  If you are renting property now, realize that you are paying a mortgage for someone else.  You can be paying yourself that money as well as taking advantage of tax incentives that are available to homeowners.

    Investing in real estate in a down economy is actually the best time to invest in real estate.  You have to make sure that the property in which you choose to invest is in area in which the homes have systematically grown in value.  If you want to speculate, you can invest in an area that is up and coming, such as a place where people are moving to get away from urban sprawl.  Track the patterns of growth in your area and determine the next development boom.  If, for example, the growth is going Southwest, go to an area one point farther than the most recently developed area and purchase property in that area.  Because prices are low as well as mortgage rates, this is the perfect time to do this.  When things get rolling again as far as developments, you may be sitting on a goldmine.

    If you own a home and still want to invest, consider buying a home that you can rent to others.  People always need a place to live and a rental unit is usually a good investment.  Because of low interest rates and housing prices, you should be able to get a good deal on both property and a loan.  Loans for investment property that you plan to rent are usually different than those in which you plan to live and in some cases, you need to put down 50 percent of the property value to get a loan, so be aware of that.  However, the rates are still rock bottom so this is a good time to buy.

    If you are investing in property that you plan to rent to tenants, make sure it is in an area where people want to live so that you can be assured of having a steady flow of income.

     

     

     

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