5 Reasons Why Single Family Homes Are Better Investment

Posted in the Foreclosures Forum

Since: Mar 12

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#1 Apr 10, 2012
Appeal to broader set of renters

During the recent downturn in real estate, unfortunately a lot of home owners have lost their homes. They still prefer to live in single family homes as opposed to an apartment. What this means for a real estate investor is that he now has a larger rental pool for his (single family home) property. In addition, people who are moving across the country for job opportunities are sometimes renting out their original homes and looking to rent a single family home for themselves. There are several such factors that make single family homes' rental pool larger and easier to deal with.

Getting a mortgage is easier

When you are applying for a mortgage on a single family home, it is a much more predictable and easier process as compared to that for a condominium. The laws for getting mortgage on condominiums are much more stricter in today's economy. This makes the buying process of a single family home seamless and hence a better investment choice.

Stable Property Value

Another factor that makes single family homes a better investment choice is that with everything else being the same, single family homes tend to hold their values better than townhomes or condominiums. This is important to keep in mind since in addition to a steady income, an investor needs to also keep in mind the appreciation potential of the property.

Predictable cost structure

Since a single family home is an entity in itself, it doesn't get affected by other factors that could vary the cost of owning a condominium or townhome. A condominium or townhome has shared walls and common areas and sometimes the maintenance cost could increase when repairs etc. are required. With a single family home, you are more in control of the cost of owning a property and that makes it a better choice.

Easier when you decide to sell

When you are in the market to sell a single family home that you have been renting out for investment, it is an easier task since your pool of buyers are both investors as well as people who are looking to purchase homes for themselves. Of course you still incur the cost of selling the home but it is a much easier process to deal with.

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