Time to Reconsider Real Estate for Investment

May 21, 2012

Real estate investors can profit by purchasing and improving homes for rentAs we see markets continue to recover and hear more news about real estate inventory reaching lower levels, it is time to consider

real estate as a solid investment again. As times have changes, the old strategies won’t work anymore. Equifax real estate expert Steve Cook explains how to make the most of these opportunities and what pitfalls to avoid in his recent article series, “

Buying a Home: Facts and Fictions about Investing.”

The first point that Cook makes is that all real estate

investing isn’t all flipping. This is because home prices are still lagging, so purchasing and renovating a home doesn’t generate the same kind of quick return on investment it once did. In addition, homes are staying on the market longer. The National Association of Realtors (NAR) found that only five percent of homes purchased by investors last year had already resold. NAR expects that the typical investment buyer plans to hold onto a home for five years.

Another misconception is that all real estate investors are rich, since they buy homes with cash. NAR found that 49 percent of investment buyers paid with cash, while the rest used some other kind of financing. This includes taking out a traditional mortgage to live in their investment while fixing it or taking out a home equity loan or second mortgage to purchase their investment properties. This second way of financing is preferable for many bank owned foreclosures, as cash from the second mortgage will mean a quicker closing and often a discount to take the property off the bank’s ledger.

There are more tips for budding real estate investors on the Equifax Finance Blog, where you can also find expert advice to reach your

financial goals when it comes to credit, investing, real estate and more.

About The Author

Read All Stories By Mitch Levinson

Mitch Levinson is the author of “Internet Marketing: The Key to Increased New Home Sales” published by BuilderBooks. He is an Internet marketing expert with expertise in search engine optimization, website development, email marketing, social media and CRM consulting services. He is known for creating effective programs that can be tracked through analytics to prove effectiveness and ROI. Mitch is founder and president of MLC New Home Marketing and MLC FlatFee Realty, as well as managing partner of mRELEVANCE, LLC, a Marketing, Communication, Interactive agency with offices in Chicago and Atlanta. He currently leads the Chicago team. A Multi-Million Dollar Sales Producer who earned an MBA in Computer Information Systems and eCommerce, he brings a unique perspective and experience to the field of real estate communications. Mitch combines the two interests in order to help home builders and developers gain a competitive advantage through the Internet and technology. When he isn’t behind a computer, he enjoys participating in sports and coaching his kids’ teams. Mitch resides in Arlington Heights, Ill., a northwest suburb of Chicago, with his family, which includes two rambunctious labs. Visit my Google+ profile.

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