A question that we get asked often is if now is the right time to buy investment property. Our answer is yes– as long as you are prepared for it.
Right now interest rates remain incredibly low, even for investment property which is usually a point or two higher than an owner occupied mortgage. Combine low interest rates with townhomes, condos and even some single family homes priced well below tax value, it is absolutely a great time to buy an investment property. You can maximize your investment and still get a nice cash flow from the monthly rent.
However, there are a few things you must consider before you buy an investment property. You must be prepared with a down payment of 10% or even 20% to get qualified for a mortgage. You must have a higher credit score and reserves in the form of cash in the bank, 401K, etc. to prove that you can afford the PITI for your current home AND the PITI for your investment property for 6 months. Lenders are scrutinizing investment property more closely so you do have to be prepared to show a lot more than you would if you were just getting a mortgage on a home you were buying for yourself.
If buying investment property is something you have always considered and would like to know more about then please let us know! We would love to help you navigate the waters and help you buy your first investment property!
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