Why You Should Invest In Real Estate in 2011

Real Estate has long been recognized as an excellent way to build long-term wealth. And, “buy low, sell high” is the mantra of every smart investor. That’s why the real estate market of 2011 is ideal for anyone interested in beginning a portfolio of rental properties. A plan to build passive retirement income through real estate investments requires time, so you need to begin the process when market conditions are ripe. Like now.

Today, interest rates are low—30-year fixed rates are below 4% for those with excellent credit.  Home and condo prices, in the Denver area and throughout the country, are soft. That combination, along with the strength of the rental market, makes this a great time for real estate investors.

If you are ready to move up to a larger home, today’s low real estate prices make this an excellent year to do that. Or, perhaps a job change is forcing you to move. No matter why you are moving to a new home, you can benefit from the current real estate market conditions when you turn your existing home into a rental property.

After all, “buy low, sell low” does not add to your bank account. When you take advantage today’s low real estate prices to buy, and hold your current real estate assets until prices improve, however, you can increase your net worth.

There are actually several situations that can make it profitable to hold a property for just a few years. For example, if your home’s value is being depressed by comps that include foreclosed properties, you can probably benefit by waiting-out the current foreclosure crisis. Or, if you are in a development (single-family homes or condos) where your “competition” is new homes offered by the developer, prices are likely to stabilize higher when the neighborhood is completely built-out.

Typically, real estate investors pay a higher interest rate on home loans than consumers who obtain a standard home mortgage. But, those with an existing low-interest mortgage can turn that loan into an investment strategy. Even if you never intended to become a landlord, the real estate market of 2011 should make you reconsider turning your home into an investment property. When you are ready to sell, Sherman Macdaniel, a licensed Independent Broker in the state of Colorado, can help you get the best possible price for your home.

If you have no desire to become a landlord, a professional property management company is a necessity. Highlands Property Management, Inc. keeps your home leased to qualified tenants, makes sure that maintenance issues are addressed, and collects your rents. You will receive monthly rental income with complete reports and annual tax documents.

To get an estimate of your property’s lease potential and a quote on our services, contact us on-line or call 303-683-5956. For additional information about how the 2011 real estate market is affecting rentals, read the Barron's article below.

--Sherman P. Macdaniel, President
Highlands Property Management, Inc.

Renter Nation: 4 Million More Renters by 2015 by Gene Epstein, Barron's