Real Estate Investing Today

If you are thinking of investing in real estate in today’s market, there couldn’t be a better time. Most experienced investors say that the best time to make money in real estate is during a soft market.

The main reason that makes this a good time for investors is that the current economic crisis is hitting many homeowners hard and in a big way. People bought homes at high prices and now find themselves under water on their mortgage. Some have lost income due to job or business loss and now creditors are reducing or withdrawing credit lines. The situation is dire for many, and foreclosures are at record levels. On the other hand, it has become much harder to get a mortgage loan. With tighter lending standards, down payment requirements and declining home values there are also less buyers in the market. This translates to less competition for available homes. So if you have the money and can afford to hold on to a property for the next three to five years there are deals to be had.

One strategy being used by many investors now is lease options. This strategy allows investors to potentially make money with no money invested. The investor finds desperate sellers that are more concerned with making the mortgage payment than an immediate sale. These sellers have met with hard times but have sufficient income to meet other obligations. They may be willing to lease the home with an option to purchase at a later date. This benefits the potential buyer that may not be able to come up with a down payment or has less than perfect credit by providing an opportunity for them to own a home. The investor collects an option fee for bringing the two together and sometimes a portion of the monthly rents as well. It all depends on how the deal is negotiated. A savvy investor will be creative as the main objective will be to create a “win-win” situation for all.