Yesterday was a special day for both my buyer and I. I think it's an experience that the both of us will remember for a long time to come. It was both of our very first closings.
Future Of Real Estate
Technology has sure changed the way people do business in real estate. Changes in our society and in regulations now allow for everything from the buyer to begin his search on his/her phone and PC to signing documents via esign. But where is the market headed?
8 years ago I became a homeowner after seeing generations rent. I followed suit because of programmed conditioning. When I finally realized that there were other choices to make, I opted for the road less traveled by in my family and would certainly say that it has saved and made me money in the long run.
When I purchased our home I was paying rent of $1,000 a month for 5 years at the same place. I calculated that I paid $60,000 towards someone else's mortgage or worse yet, right in their pocket since the home was 20 years old and owned free and clear. Had I continued to rent then I would be paying nearly $1,600 in rent monthly and close to $96,000 in someone else's pocket over another 5 years.
By purchasing I was able to stop the runaway train of monthly housing expense dead in it's tracks. Today I pay the same $1,100 that I started with 8 years ago except now the last 8 years of payments are in my pocket in the form of equity. Traditionally, we are not taught in school what equity means or what positive impact it could have on our finances. In a nutshell, instead of your payments going into someone else's pocket it goes into a virtual bank of "credit" that you can use to "leverage" in various financial situations. Invest, Purchase, Remodel, Start a Business, the list is limited to your imagination only. Here it is in graph form:
I suspect that the more folks know about equity, real estate and the power that investing can bring you than I can see more young folks spending 5k to get into a four plex and rent three units out for $800 each while living in one unit. This would pay the note of $1,100 for the property while taking in $2400 in monthly payments which would yield a positive passive income of $1,300 monthly while someone else pays off the mortage.
Whether you flip up every 5-7 years and climb from 150k homes to 300k homes or you purchase 40k homes to flip for 120k or even in our previous example start with 4 plexes through 12 plexes and end up with a 24 unit small apartment complex, real estate can hedge against the ever rising rent and provide either a homestead for you and yours or a vehicle to reach higher goals in your life.
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My name is Kiwi Bautista, a realtor with Dream Home Realty and Owner/Operator of HubCityProperty.com Call me today at 337-706-4445 if you are looking to buy, sell or invest in real estate. In a s....