Why Everyone Needs to Buy a Home in 2015

Posted by JD Esajian

Everyone needs to buy a home in 2015. Those that already have homes need to consider moving up, or even finding second homes and investment properties. So why is buying a home so important this year? How can buyers overcome the perceived challenges?

Rentals Are Taking Over

Rentals are taking over America. More land and existing homes are turning into rentals. Home builders, large funds, and private real estate investors are converting into rentals. As a result, homeownership in the U.S. is dropping to new lows. Saturation of rentals creates a competitive environment. However, demand for rentals remains so high that rents and application requirements keep going up. While many are turning to rent as the ‘more affordable option,’ it is becoming tougher than buying. It is twice as expensive to rent as buy a home in many parts of America. Landlord screening procedures and move-in costs are now even tougher than some mortgage lender criteria.

Fortunately, there are fewer options for renters. The options that are available are more expensive and tasking than they used to be, however.

None of this is a secret. Yet, for many, buying a home still appears to have its challenges. Many still suffer with bad credit. Others expect the down payment requirements to buy a home to be too burdensome. Millennials are one of the biggest pools of prospective home buyers, but many have not yet established their credit. Many do not feel they are ready to settle down yet. Still, everyone needs to buy a home in 2015. Let’s take a look at the reasons:

The Benefits Of Homeownership

There are many benefits of homeownership. Even if you think you are not ready to settle down, or may lack the credit and finances to buy a home this year, it is worth remembering the following:

1. Lower living expenses
2. Tax breaks
3. Ability to create your own environment
4. Owning a tangible asset
5. Building wealth and a nest egg
6. Enhanced school performance for kids
7. Eliminating housing costs in retirement
8. Avoiding getting priced out of your home town by landlords
9. Growing an inheritance for the next generation
10. Acquiring passive income producing assets

Why Buy A Home Now?

Renting is unsustainable. It is as simple as that. There are many potential excuses not to buy a home. Many landlords and corporations would love for you to believe them. Your rent pays for their investments, expensive cars and clothes, and larger homes. We all may have to rent sometimes. But, if you stay a renter you and your family will always be captive. You’ll always be ransom to what landlords ask for. Who knows how much rent will be in 5 years? Or where you will be able to afford to live? Chances are it will be somewhere far smaller, for more money. Perhaps even in an inferior location.

At the same time; buying a home has rarely been as affordable as it is today. Interest rates remain low. Home prices are lower than they will be for many years. Buying a home now offers an incredible bargain. For many, it will make all the difference in surviving and thriving later in life. Waiting will only mean paying more for living, and paying lots more for the same home later.

Overcoming Home Buying Challenges

It’s obvious that buying a home is smart. Buying more than one home can be even better. This is the time to buy, but what if your credit isn’t perfect? What if your credit is terrible? What if you are self-employed? What if you don’t have much of a down payment?

Buying a home this year can still be easier than you think. If credit is the challenge, you can fix it. You can have negative items removed by challenging them yourself. You can use an attorney or credit repair specialist to assist you. There is an estimated 2,000 or more down payment programs in America. These programs can help provide the down payment you need. There are even programs to help with closing costs and home improvements. This is on top of the return of 100% financing, and stated income loan programs. Self-employed borrowers can take advantage of alternative mortgage lending to qualify for home loans.

There are still options for those unable to fix their credit or qualify for home loans in 2015. Rent-to-own, seller financing, and lease options can all work.

The key is not getting discouraged. Get out there and find a way to buy a home.

The Growth Of Online Real Estate Investing In 2015

We’ve already seen regular home searches migrate almost exclusively to the internet, and 2015 is expected to take this even further. So what is driving these trends? How will individuals be investing in real estate online in 2015? More importantly, how can they do it in the safest and most profitable way? 

2015 Real Estate Trends

This year is shaping up to be a far more exciting year for real estate investing than many expected. The new 2015 Global Investor Sentiment Survey reveals a whole world full of investors bullish about U.S. real estate. Over 80% of respondents anticipate the market heading up this year, with increased investment volumes. Additional research shows billions in capital waiting to be invested in 2015. More than three quarters of investors said they planned to increase their portfolios over the next 12 months.

Low interest rates, moderate asset prices, and lackluster alternatives are all working together to form a profitable landscape for income property investing this year.

Rising rents are to keep on lifting rental property spreads, and the influx of Millennial home buyers is starting a domino effect – which is rolling over into middle and high end luxury markets, creating more inventory and acquisition opportunities. Global interest in investing in America is forecast to keep up demand in gateway cities, while more turn to secondary markets for growth and yield.

Out of Area Real Estate Investing

While there will continue to be real estate investment opportunities throughout the U.S. in 2015, there is no question that individual markets will continue to turn at different stages; offering slightly different volumes, spreads and matches for separate real estate investing strategies. Serious investors looking to expand portfolios will naturally look further afield. This is especially true of sophisticated income property investors looking for buy and hold deals. Both newer and mature investors will seek more geographic diversification in their portfolios this year in order to sustain optimal returns and a strong safety net.

Direct Investment in Real Estate

Direct investment in income producing real estate assets is expected to continue to be a top trend in 2015. The last couple of years have seen the overwhelming majority of US millionaires choose this path to preserving wealth, building passive income streams, and achieving higher yields. Those still on their way to being millionaires are finding direct investment gives them the best edge in achieving gains, while preserving what they make. Both private equity and debt investors are still finding real estate trumps other options when they invest directly, and especially considering the low rates expected to continue for most of the year.

Real Estate Crowdfunding 

The media has kept crowdfunding in the headlines, but not always for the best reasons. As more copycats have jumped on the bandwagon the Huffington Post notes the number of real estate crowdfunding platforms has rapidly risen to over 75, with more on the way. This is one form of online real estate investing that is catching attention, but has been criticized by sophisticated investors like the Shark Tank panel, as it has been marveled at for cool factor. The ability to invest out of area in the best quality and most profitable US rental properties from anywhere in the world via a smartphone or mobile tablet is great. Real estate syndications and partnerships certain still have their perks too. However, while interest rates are so low, and capital for borrowing so plentiful, most accredited investors may find crowdfunding unnecessary, and that most platforms lack the trust, reputation, and track record other options provide.

Turnkey Real Estate Investing

Tested and proven turnkey real estate investing programs really bring together all the best of out of area and online investing. The yields and cash flow can certainly trump publicly traded REITs, as does the security, low volatility, and net returns.

The one challenge some domestic U.S. property investors face is getting over the mental hurdle and embracing this investment strategy, while foreign investors that have invested this way for years swallow up all the best deals at a rapid pace. In fact, many turnkey programs now have substantial waiting lists.

Those that will be the most successful in investing and making new income property acquisitions this year will be those that take the best advantage of technology, choose their locations wisely, and who weigh each opportunity on its own merits.