I was reading an article by Ryan Dezember in the wsj about house renting companies that are starting to see a benefit in buying suburban houses to rent rather than remodeling older homes in the city. The article summarized some interesting points and strategies that are worth considering.
The rationale for buying a new house to rent out arises out of evolving situations that home buyers are facing. When housing prices go up in the suburbs, young families cannot find homes at entry-level prices that they can afford. Many of them are burdened with student debt and don’t have the credit standing to buy the higher priced new homes. So, they are willing to rent to make sure their kids get to go to good schools and live in safe neighborhoods.
Renting houses (old ones or new ones) is a promising investment for those who want a steady income instead of a big single payoff. New single-family homes, versus older ones, can be expected to attractive to renters, stay occupied, and provide steady income.
There seems to be two ways to make this investment work: 1. Buy a new house and rent it out yourself, or (2) buy a new house, find occupants for it, and then sell them to a big housing rental company. According to the wsj article, there are quite a few rental home companies starting to look at buying rental houses in the suburbs.
Buying new has benefits:
- Save on sales commissions,
- Save on remodeling costs,
- Charge more rent for a new home,
- Outfit the house with the preferred fixtures to rent them faster, and
- Save on maintenance costs for 10 years or so
Since this idea is starting to get around, getting the money quickly so you can squeeze out the competition is something that I can help you with. For rental properties, I offer loans at low interest rates, for terms of 3 to 7 years, with low closing costs, quick closings (15-20) days, and a loan that is based on the asset rather than on your personal credit record so there is less personal paperwork to do.
So, talk to a builder near you who is willing to sell cheap to clear the books at the end of the fiscal year and find occupants, and prepare for a steady income for years to come.
For a quick pre qualification application, follow this link: http://investorslendingsource.com/pre-qualification-program
I would be pleased to have you call or e-mail too.
Pat St. Cin