Newest Trend...Becoming Landlords to Family Members

I am not sure this is the newest trend in real estate, perhaps it is an old trend resurfacing in a big way, but purchasing as an investor and renting back to a family member is BIG!  At least it has been a significant part of my business this year.  The interest rates are low; parents/grandparents might be sitting on a lot of equity in their present homes that is available at all time low rates as well.  Rents are high and rising along with the demand for rental property.  Knowing  family member who for many different reasons will be renting rather than purchasing a home in the present market makes for a perfect combination of landlord and tenant.

  In some cases, parents are paying for housing for a college student or new graduate.  Why not turn that into an investment rather than allowing someone else to collect the rent?  It may also be more cost effective to purchase.  Buying may cost less than renting and the investment write-off be a tax advantage.

  Of course, there will be things to negotiate not only with the seller but with the now
tenant/relative/child/sibling.  The mortgage rate for investors are a bit higher than that of the owner occupied and investor owned property might also have a higher real estate tax rate. The mortgage process for the investor is tedious and paperwork exasperating. In the end, there are many different ways to use resources, to invest and to be there for a family member, but providing one of the most necessary elements, housing is tangible and generous. I feel I am seeing a tread, each time I have witnessed it in my personal business it is a gesture of love and caring and it is deeply appreciated.  Something to think about....

There has never been a better time to buy investment property

With so many distressed properties on the market, there has never been a better time to purchase what one of my real estate instructors called a "money pump." Distressed properties are increasing and driving the market. There is a large pool of renters who are unable to purchase for the next couple of years due to credit problems but who will need homes. There is a pool of potential buyers who are not quite ready to jump in, but would enjoy the experience of a single family home or townhome without the responsiblities of homeownership. This is the time for investors to charge forward and take advantage of a very good opportunity!

It is also a great time to consider renting out your "too big" or "too small" home and moving into something more suitable for your current lifestyle. If you are currently living in the family home with three or four bedrooms and ready for a maintained condo or townhome, consider the option of renting out the family home and moving on. Have you always wanted to live in the sunshine states? That option has never been more affordable...rent out the big house, find a good realtor to be your property manager and enjoy the sun in your more affordable maintainence free living space in Florida or Arizona.

Mark Twain said, "I was seldom able to see an opportunity until it had ceased to be one." This is a great time of opportunity. Call your realtor, jump in. The time is now!