Home Buyer & Home Seller Guide

Enough has been said about the fact that this is a buyer’s market.  This fact having been conformed by several investment and real estate professionals, it begs the questions “is this a good time to buy an investment property?” The answer is emphatic YES. With property prices at an all time low, even rookie investors can take advantage of this opportunity and start by diversifying their portfolio into real estate. Listed below are number of reasons you should be looking at buying an investment property:

Investment Property Purchase Considerations

• Prices: The first and foremost reason you should be looking at acquiring an investment property is the fact that property prices are at record lows. In addition experts claim that prices are as much as 30 percent below their peaks.  This is also a buyers market and with numerous foreclosures flooding in to the market, buyers could get a property for as much as a 45 percent discount.

• Tax Credit: While the government has extended the first home buyer’s tax credit till the end of the year, it has also expanded its spread by allowing to existing home owners to also take advantage of the tax credit. Existing homeowners can get up to $6,500 from the government in the form of the tax credit, provided they meet the criteria set out.

• Additional Source Of Income:  The best part of owning an investment property is the fact that the investment property can generate additional income for you in the form of rent. For qualified borrowers who can obtain finance from a financial institution, the additional rent generated can prove to be an invaluable help. While there may be a lot of houses on sale, there is still the want for rented accommodation and this may be a god time to cash in.

• Tax: the interest payments on an investment property are usually tax deductible. This would mean that at the end of the financial year when you file your taxes, you would be getting a bigger tax refund from the government. The additional tax refund could go towards paying off your owner occupied mortgage or additional debt that you may have incurred. In addition to this, if you are buying a property in a particular suburb or district, you may get additional tax rebates and reliefs owing to the fact that the government is trying to develop those particular areas and zones.

• Tangible Asset: Unlike shares and other securities, property is a tangible asset and usually holds it’s value much better than securities and investments traded on the money markets.  Property prices are not subject to as much volatility as shares are.

• Diversification: The age old saying of “don’t put all your eggs in one basket”, is truer today than has ever been. With the recent financial meltdown investors have learned not to put all their money in securities and investments. Individuals who invested in property are currently finding themselves in much better situation than their counterparts who went all in to the share market.

These are some of the reason why you should consider buying an investment property. Not only for the above-mentioned reasons but also owing to the fact that property is one of the only assets that you could ad value top yourselves. By making smart renovations and modifications, you could increase the value of your property above the accepted market mean.

Reference:

1. http://investmentinproperty.net/10-reasons-to-buy-your-first-investment-property/