Investing when the market takes a hit.
During tough economic times, the real estate community takes a hit. When a real estate investor looks at the market right now, they see rates going up seemingly by the week. One thing about free market capitalism is that it works. When one side of the market goes up, most times, the other side goes down. As an example, long-term loan interest rates are climbing up for those that wish to purchase real estate assets using a bank. At the same time, the price for those assets tends to come down to balance the market out. It shifts from a seller’s market to a buyer’s market. Real estate properties still get sold and both investors and owner occupants still purchase properties even when the market looks the way it does right now.
This is the time when many in the industry increase their real estate portfolio by taking advantage of the lowering sale prices, which helps to offset the increasing interest rates for long-term loans. Some don’t realize that “Interest only loans”, “Hard money loans”, “Bridge loans” and a “Line of Credit” have interest rates that haven’t gone up like the base rates on conventional or long-term loans. Real estate investors can and do use these financial vehicles to purchase property as well. They are a benefit to the investor as they allow them to purchase a property quickly and at a lower price point, retain the property for a “rent or lease” property, or they can use this time under the interest only or bridge loan to renovate the property and increase its value for a later sale when the interest rates return to “normal”.
We have several of these financial vehicles available to the real estate investor for residential or commercial properties. Reach out to us and let us help you analyze your real estate needs and see which type of loan or line of credit would work for you!