I am writing this before I leave to go to the annual National Association of Realtors Convention in San Francisco. I always learn at these conventions and also hope to bring back ideas to Prescott.
Now For A New Idea In Rentals:
First, something new like new home construction for rental and retirement incomes may turn into a worthwhile investment. More single family homes across the nation are being built for rental income. There has been a steady decline in home ownership since the housing bust. Many investors can no longer find enough foreclosures or short sales left to convert to rental units. In many areas. new construction for rentals is the new thing. About 6% of all new homes being built for rentals are up from a historical 2% average.
The Prescott Area:
We have an ideal area for new construction rental homes, condo's, townhomes, patio homes, etc. Many retired people have had enough of home ownership as they now want to travel and not have the responsibility of home ownership until later when traveling also gets old. From a retirement rental standpoint, our area has four great year-round living seasons, but some still like to travel in any one of our great four seasons.
Many retirees feel real comfortable in new homes and many like the limited amount of amenities for meeting people in the newer subdivision such as community rooms, exercise rooms, swimming, and tennis, etc. and, not everyone wants golf and/or needs it. We also have newly married couples and some with small families saving for a down payment to buy, which means most are great renters.
For Small Investors:
New homes are really much more carefree as the they will come with the builder's warranty, appliance and heating/cooling warranties. Some builders may provide warranties of ten years, and others may be purchased. With that being said, that will require a lot less time and cost in maintenance, at least during the initial years of ownership.
Cost Of New Builds:
Many new builds are great values as some builders purchased their lots at a reasonable cost. Everything else may be purchased at a builder's volume discount that you and I can't do. They are normally a great value, providing you do not make a lot of changes or add a lot of costly options not needed. For a new build, you may also have some larger and faster tax write-offs. Check with your accountaant regarding this. Please also check on community and subdivision regulations on the amount of rentals allowed; some have rules and some do not.
With interest rates being at near historical lows, we all recognize they will not last forever. You will look very smart in 15 years to have a loan at about 4% instead of 7-10%. Single family homes are usually easier to sell than larger rentals if someone may need to cash out for some reason and, historically, they have more appreciation.
Building costs, as I see it, will continually increase over time. I believe our area appreciaation over 15 years may be from 4 to 6% annually.
What a great way to double or triple your retirement income and, guess who pays most of your extra retirement funds-----some one else! Could this be any better? You can figure that one out for your own situation.
I highly recommend this now! However, do what's comfortable for you. If you have any questions, please call me at 928 533-4455.
Thanksgiving is my favorite of all Holidays so I wish you all a Very Happy Thanksgiving, a great life ahead for all, be happy, be thankful and be helpful to many.
If you have any real estate questions about buying and selling, feel free to call me. It may save you time and money! (928 533-4455)
Remember my two favorite sayings, 'Experience Isn't Expensive, It's Priceless!' and 'Selling A Home Is Easy, Doing It Right Is The Key!'
Lee Amble, Realtor/Consultant
NATIONAL REALTY OF PRESCOTT
Lee's cell: 928 533-4455
Jan's cell: 928 533-4488