Buying an investment property can be lucrative if you plan to buy a home for the first time. While most people usually wait for years to buy their first home before buying an investment property, you can start sooner when you purchase an investment property as your first home. Buying an investment property will pay off if you get the right property. By renting out some part of your house, you can limit your responsibilities and leverage your credit into an investment.
Still not convinced? Here are some reasons why your first home should be an investment property.
Buying an investment property as your first home comes with many tax benefits. For instance, you can get back some of your expenditures, including paper costs and upkeep on the property, to reduce taxable income. In addition, reducing your tax as the year ends can provide huge savings, especially if you're earning high with a lot of tax. So even though this is not your main reason to buy an investment property, you ought to consider it.
Leverage into Your Home
Buying an investment home as your first home means you won't have to fund the acquisition of your actual home at some point. In fact, investment properties that are bought wisely offer you a sizeable amount of equity and wealth. In addition, those that pick an investment property may eventually manage to purchase another property within a short time.
If you buy the right investment property and select the right tenants, you can gain positive cash flow and use the money to improve your life. In this circumstance, the tenant pays off your home purchase and possibly leaves you with extra funds. In addition, future costs such as a mortgage, maintenance, and insurance are covered by the rent paid by the tenants. Also, buying an investment property makes mortgage lending straightforward since lenders will consider your possible rental figure and cash flow.
Protection Against Inflation
Over the past few years, the real estate market has seen inflation. While these changes can affect the stock market, real estate survives inflation. Inflation can benefexit property owners because rent prices tend to increase with inflation. This means you can raise your investment property's rent as inflation increases. Your mortgage payments will remain the same with a fixed-rate mortgage. This may create a more significant profit margin.
Return on Investment
Investment properties have a higher return than investing in a stock. While the stock market has a level of volatility, real estate is still going strong. In addition, real estate has the benefit of being a real asset, unlike stock. Therefore, buying an investment property could be better than purchasing stock if you want an excellent return on investment.
Let's Get Started
If you're ready to explore mortgage types and steps for first-home buyer investment properties, look no further than Savvy Mortgage Services. We can help you choose a mortgage that is right for you. Contact us at 786-527-0200 to start the process, and get a quote.
We look forward to working with you.