Why Buying a Home Is a Good Investment for TN Residents
Purchasing a home helps you build equity, which you can later leverage on other real estate investments or use to help fund your retirement. Most homes appreciate over time, so buying a home in Tennessee is one of the best investment choices you can make.
Many first-time homebuyers apply for a mortgage via FHA loans, so it’s helpful to know what FHA loan requirements are. Let’s take a closer look at when it’s a good idea to buy a home in the Volunteer State.
Consider Your Real Estate Strategy
For those looking at a house as a long-term investment, a 13 to 15 percent annual return is a decent rate. If you’re mainly looking for short-term cash flow, choose a property likely to generate at least 6 to 8 percent appreciation. If you’re looking to do a short-term flip, keep in mind that many loans are geared toward homebuyers planning to stay in the property so you’ll most likely need to pay cash for the property.
Buy a Home If You Plan to Stay 5 to 7 Years or More
Many experienced experts advise that real estate makes the most sense if you plan to maintain and improve your property. You also need time to build up equity and recover from the initial expenses of buying a home.
Buy If You Could Resell the Property at a Profit Today
Become familiar with what homes are selling for in the area. Measure the asking price against similar homes in terms of condition, size, style and age. If the potential purchase is in better condition than other homes, it may be worth it to put in an offer at a higher price point. Buying in a good location or an emerging neighborhood can help you protect or increase your profit.
FHA loans are a great way to obtain financing insured by the Federal Housing Administration, which helps keep your mortgage interest rates low. Contact the Mortgage Investors Group today to learn more about FHA loan requirements in Tennessee.