Click To See All 3 Bed Homes Under $100k in Bentonville & Rogers School Districts
Are you waiting for the market to hit bottom before you buy? Well, in my opinion, it is too late. The market has already hit bottom and is on its way up.
I like to buy really run down homes and fix them up and flip them or keep them as rentals. I have bought homes in Bentonville in the $20 per foot range in 2009, then $30 a foot range in 2010, and as high as $40+ per foot in early 2011. I have only seen a handful of homes under $50 per foot in Bentonville in the last year. The prices are certainly going up.
I sold 36 homes in 2011 and they average was $106,000. The bulk of those buyers were buying homes as investment properties. They generally took money out of the stock market that had remained flat for several years and put that money into a rent house. They were generally cash buyers or would buy with a significant down payment. This way they could draw an income from their investment and still have an asset that will appreciate in value. The rent house will be paid for by the renter, the income property creates a variety of tax savings, and it will gain value over time. Buying a home to rent is all the more attractive with decreased property values and interest rates at an all time low. Then there is the fact that rental income will adjust up over time with inflation which is another pretty big positive.
The math looks like this:
3.5% Down Payment: If you buy a $100,000 home with ONLY at 3.5% down payment, at 4% interest, amortized over 30 years, figuring 1% for taxes annually, and $50 per month for insurance your payment is $673 a month. This same home will rent for an average of $850 a month in Bentonville. This leaves you $177 a month or $2124 a year in cash flow. If you apply all this to the note the 30 mortgage would be paid off in around 20 years.
20% Down Payment: Here is where it makes much more sense. If you buy a $100,000 home with 20% down payment, at 4% interest, amortized over 30 years, figuring 1% for taxes annually, and $50 per month for insurance your payment is $515 a month. This leaves you $335 a month or $4020 a year in cash flow. If you apply all this to the note the 30 mortgage would be paid off in around 11 years. The house would most likely be worth 150% or more of what you paid for it.
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Email or call me for more information. My number is 479-640-8375 and my email address is CodyBurnettRealtor@gmail.com.
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