Demand for Rentals is Up

By Lee Davies

As America comes upon hard times, many home owners have unfortunately had to sell and move into a rental home as they look to regroup and rebuild their nest egg.  The result is that good single family home rental properties are tough to find, rents are going up, supplies are decreasing, and there appears to be a great opportunity for investors to step into the real estate market.
 
When one combines the sub 5% “non-owner occupied” lending rates, along with the home bargains presently in the marketplace, this is a fabulous time for investors.   Prices are down 30-50% over the peak market in 2007 and are likely to stabilize.  Renters are in desperate need of a good home to hold them over with little supply.   And finally a fixed 30 year loan can provide a long term wealth building platform. 

While it sounds too good to be true, one may wonder why everyone is not jumping into this venue.  The answer is simple.  An investor needs a minimum of 20%, and ideally 30-40% down, along with a stellar credit score north of 700, in order to easily obtain financing.   Due to the financial crisis of the past four years, most folks have lost their liquidity and are not in the position to purchase investment real estate.  It is for this reason that there lies a great opportunity; the demand is down due to the lack of buyers with liquidity and for those who can acquire, the time is right.