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Rental Property Investment During High Interest Rates

Real Estate Agent with Royal Shell sl3505095

Why Rental Properties are still a Good Investment even with High Interest Rates.

 A 30 year fixed rate mortgage is the most important tool available to investors. Many real estate investors have left the market as a result of rising interest rates. Mortgages with fixed rates allow you to know your exposure each month and shield you from future rises. You can use a financial institution's loan to leverage your money and buy more assets. Simply put, when buying real estate at a time when rates are high, you must do your homework and, more importantly, work with a knowledgeable agent who is friendly to investors.

Playing the long game is important when buying and holding investment properties. Cash flow is always crucial, but you should also consider appreciation, demand, the state of the property right now, and the rental prices as they stand. Many people often only consider the cash flow number; this can be a significant error in any market. As they say, the turtle wins the race, thus making a quick profit is not always the wisest course of action.

Your money loses value while it is parked in the bank due to rising inflation. Real estate remains a tried-and-true investment for your hard-earned money in an environment when the stock market is, at best, fickle.

Don't forget about the tax benefits of getting a mortgage and real estate investing. Depending on your state, you stand a good chance of receiving tax advantages if you own rental property. For owning a rental property, real estate investors typically pay little or no taxes. It's possible that you won't even pay taxes on the rental income you receive. Additionally, there are deductions for things like mortgage interest, insurance, wear and tear on the body, and upkeep of the property. These tax advantages can be helpful given that living expenses are rising daily.

Lastly, buying a rental property gives you pretty much total control. You get to pick the type of property, the tenants you work with, and the investment management style. Depending on the locale, you might think of rental homes, rental apartments, or short-term vacation rentals.

 The management of your rental property is not handled by a third party, unlike stock investments. You are accountable for your rental properties. Only you have the authority to choose who oversees them. Click the link or follow me on social media for more real estate investing advice, to set up a consultation, or for more information.




Bill Salvatore - East Valley
Arizona Elite Properties - Chandler, AZ
Realtor - 602-999-0952 / em: golfArizona@cox.net

Great information.  Thanks for sharing and enjoy your week!

Jul 25, 2022 01:25 PM
Kristin Johnston - REALTOR®
RE/MAX Platinum - Waukesha, WI
Giving Back With Each Home Sold!

Great information.   Thanks for sharing and enjoy your day!

Oct 18, 2022 06:23 AM