Open House Schedules this weekend of September 22 and 23

OPEN HOUSE
📣 7605 Devins Ridge, Independence Twp 48348 on Sunday with Gayle
12 pm to 3 PM
218061113

 

oh devins canva

Bridge Valley Family Resort. All on 1.5 acre lot. Estate boasts 5 bedrooms, 2 owner suites with private baths, jetted jacuzzi and showers. Two story great room with surround sound, gorgeous built ins, fieldstone gas fireplace and large windows for beautiful views of nature. Open concept kitchen perfect for entertaining. Home has granite and tile baths throughout. Customized laundry and mudd room with granite sink, cabinet and cubbies. Lower level is a finished waikout with large family room surround sound, stone gas fireplace built-in cabinetry. Full bath, ample storrage. Exterior has an in ground heated 36×18 pool with diving board. Breathless landscaping and ample yard to play. . Much, much more.

 

OPEN HOUSE
📣 3798 Newport Way Drive, Waterford Twp 48329 on Sunday with Steve K
REDUCED PRICE ANNOUNCED
12 PM to 2 PM
218023288

oh newport canva

Come see this beautiful open floor plan Snug Harbour Ranch featuring 85′ on All Sports LOON LAKE. Enjoy privacy and security in this private gated community. This is a perfect home for entertaining with its huge kitchen and Great Room spaces. Relax in your Master Bedroom with beautiful lake views. Your ensuite features ceramic tile, a large soaking tub and glass walk-in shower. Enjoy awesome summer activities in your FINISHED 2000+ sqft walk out basement. This space will amaze you with it’s versatility and charm. Your glass block custom built bar will be enjoyed by everyone. The oversize lower level bedroom and full bath is perfect for your summer activities. Your garage is listed as a 3 car. You’ll find that and much more making this space perfect for a car enthusiast.

 

OPEN HOUSE
📣 102 E Hickory Grove, Bloomfield on Saturday with Chris
12 PM to 2 PM

BIRCHWAY (4)

Totally renovated in the last few years. Gorgeous new kitchen with white wood cabinets with soft close doors, quartz countertops and patterned aluminum backsplash. New laminate floor that looks like ceramic tile! Refinished, original wood floors on first floor, new carpet upstairs and in lower level, new Theratru doors and Oxbow windows. Freshly painted in soft, neutral palate. Updated baths. Upstairs bath is a European “wet room” which makes it 100% waterproof! Barrier free shower and euro modern fixtures. Three spacious bedrooms. Lower level is partially finished with small bar area and large rec. room. One car shared garage. Private rear patio. Furnace has had major overhaul, only the body is old. Amazing location!! Close to downtown Birmingham and easy access to I-75 too. Award winning Bloomfield Hills schools.

 
OPEN HOUSE
📣 4021 COMMERCE Road, Orchard Lake 48324 on Saturday and Sunday with Chris
3 PM to 5 PM

218010679

 

BIRCHWAY (3)
Seller will entertain offers between $2,000,000 – $2,350,000. The pictures are good but you need to see this house to experience it. Overlooking the most sought after lake in Michigan, is this Aspen inspired gem. Breathtaking views of the lake from every room, the entire back of the house is glass. Spectacular unconventional design, two grand staircases with wood/iron detailing, and an elevator that goes to all 3 levels. Soaring 2 story Great Room with detailed moldings, floor to ceiling windows. Barrel roof and wood trim detailing in family room and spacious library with gorgeous Brazilian hardwood floors and 3 walls of bay windows. Amazing kitchen with Cherry LaFata cabinets, enormous granite island with second sink, SS top-of-the-line appliances including Thermador 8 burner oven/stove. Grand master suite with his/hers closets, huge bath with euro shower, separate jetted tub, his/hers vanities with space left over for a couch! Two other En-suites with walk-in closets

OPEN HOUSE
📣 175 Wimbleton, Birmingham on Sunday with Chris
12 PM to 2 PM

218011832

oh wimbleton canva
This 3 bedroom 2.5 bath spacious ranch overlooks the scenic Rouge River. You’re within easy walking distance to all of Birmingham’s amenities, Poppleton Park, the Farmer’s Market (every Sunday), and even a large grocery store. Great Poppleton Park neighborhood, easy commute to downtown Detroit, less than 30 minutes. Wood floors through out and open concept spacious kitchen, living and dining area with 2 fireplaces. The home is very well insulated, low utility costs, perfect condo alternative with maintenance free landscaping including sprinkler system. 2 car attached garage. All season back porch and decks so you can sip your morning coffee or have dinner with family and friends while surrounded by nature. Handicap accessible. Updated kitchen and baths in 2003.

 

OPEN HOUSE
📣 8950 Morning Mist Dr, Independence Twp on Sunday with Paul
1:00 PM TO 3:00 PM

218049993

BIRCHWAY (5)

Gorgeous, spacious, open floor plan, this stately home is an entertainers dream! The open first floor boasts cathedral ceilings in the Living room and Great room, formal dining room, cozy den and a spacious back hallway complete with a lav, and large laundry/mudroom. Upstairs has 3 spacious bedrooms and a master bedroom ensuite complete with huge walk-in closet and jetted tub. Finished lower level is right out of a 1950’s diner! Snack bar complete with a vintage chrome soda fountain dispenser, with commercial water carbonator and chiller. Huge TV/Movie home theatre area and a full bathroom, yet still tons of storage space too! Professionally landscaped yard with low voltage lighting, fountain and stone steps leading from the deck down to the lower level walk-out basement. Private, relaxing, quiet, treed backyard overlooks small pond at the end of the property. This home has been meticulously maintained. Natural gas generator. BATVAI

Homeownership is a Dominant Gene

bLOG - HomeownerThere are many things that factor into the decision to buy a home. New research from the Urban Institute suggests that one of those things may be inherited from your parents.

Children are More Likely to Own a Home if Their Parents Did
According to an analysis of millennial homeowners, the homeownership rate of those whose parents rent their homes is 14.4%, while the rate amongst millennials whose parents are homeowners is 31.7%!

“A young adult’s odds of homeownership are highly correlated with their parent’s homeownership.

Without controlling for such factors as age, income, education, marital status, and race or ethnicity, there is a 17 percentage-point gap between the homeownership rate for young adults whose parents are renters and young adults whose parents are homeowners.”

The study also revealed that as a parent’s net worth increases, so does the likelihood that their child will own a home. These two findings are not surprising as we know from the Survey of Consumer Finances that a homeowner’s net worth is 44x greater than that of a renter.

So, a parent who is a homeowner will have more wealth which will, in turn, increase the chances that their children will own their own homes in the future.

Below is a breakdown of the relationship between a parent’s wealth and a millennial’s likelihood to own a home.

 

Blog - Homeowner 2

The Good News: The high homeownership rate amongst baby boomers (likely the parents of many millennials) is a great sign that millennials will want to own homes. We are already seeing this in the high-demand environment that we are currently experiencing in the starter and trade-up markets.

Bottom Line
Even though millennials took longer than many of the generations before them to start home searches of their own, the data shows that they will not be waiting much longer!

If You Are Thinking of Selling You Must Act NOW!

Blog -- sell act nowIf you thought about selling your house this year, now more than ever may be the time to do it! The inventory of homes for sale is well below historic norms and buyer demand is skyrocketing. We were still in high school when we learned about the concept of supply and demand, so we understand that the best time to sell something is when the supply of that item is low and demand for that item is high. That defines today’s real estate market.

Lawrence Yun, Chief Economist at the National Association of Realtors, recently commented:

“Contract signings inched backward once again last month, as declines in the South and West weighed down on overall activity.”

Yun goes on to say:

“The reason sales are falling off last year’s pace is that multiple years of inadequate supply in markets with strong job growth have finally driven up home prices to a point where an increasing number of prospective buyers are unable to afford it.”

In this type of market, a seller may hold a major negotiating advantage when it comes to price and other aspects of the real estate transaction, including the inspection, appraisal and financing contingencies.

Bottom Line
As a potential seller, you are in the driver’s seat right now. It might be time to hit the gas.

Open House Schedules for Weekend of September 15!

OPEN HOUSE
📣 3007 N. Vermont Royal Oak on Saturday with Leslie 12 PM to 2 PM
Sunday with Chris 11:30 AM to 1:30 PM
BIRCHWAY (6)
Immaculate Royal Oak brick bungalow in popular Red Run Heights neighborhood just blocks away from Red Run Golf Club and Red Run Park. This move-in ready 3 bedrooms home has 2 full baths, all beautifully updated in 2015. Kitchen offers granite counter tops, stainless steel appliances and ceramic floors. Beautiful hardwood floors on main level with a spacious family room that includes a gas fireplace and tons of natural light. Spacious Master bedroom has beautiful master bath and lots of closet space. Large finished basement for additional living space. Fully landscaped fenced in back yard with mature trees and large deck, perfect for outdoor entertaining. Welcome to your new home! Licensed agent must be present at all showings.
OPEN HOUSE
📣 102 E Hickory Grove, Bloomfield on Saturday 12:00 PM TO 2:00 PM with Chris
BIRCHWAY (7)
Totally renovated in the last few years. Gorgeous new kitchen with white wood cabinets with soft close doors, quartz countertops and patterned aluminum backsplash. New laminate floor that looks like ceramic tile! Refinished, original wood floors on first floor, new carpet upstairs and in lower level, new Theratru doors and Oxbow windows. Freshly painted in soft, neutral palate. Updated baths. Upstairs bath is a European “wet room” which makes it 100% waterproof! Barrier free shower and euro modern fixtures. Three spacious bedrooms. Lower level is partially finished with small bar area and large rec. room. One car shared garage. Private rear patio. Furnace has had major overhaul, only the body is old. Amazing location!! Close to downtown Birmingham and easy access to I-75 too. Award winning Bloomfield Hills schools.
OPEN HOUSE
📣 4021 COMMERCE Road, Orchard Lake 48324 on Saturday and Sunday 3:00 PM TO 6:00 PM with Chris
 OH_4021_Commerce_041518 (2)
Seller will entertain offers between $2,000,000 – $2,350,000. The pictures are good but you need to see this house to experience it. Overlooking the most sought after lake in Michigan, is this Aspen inspired gem. Breathtaking views of the lake from every room, the entire back of the house is glass. Spectacular unconventional design, two grand staircases with wood/iron detailing, and an elevator that goes to all 3 levels. Soaring 2 story Great Room with detailed moldings, floor to ceiling windows. Barrel roof and wood trim detailing in family room and spacious library with gorgeous Brazilian hardwood floors and 3 walls of bay windows. Amazing kitchen with Cherry LaFata cabinets, enormous granite island with second sink, SS top-of-the-line appliances including Thermador 8 burner oven/stove. Grand master suite with his/hers closets, huge bath with euro shower, separate jetted tub, his/hers vanities with space left over for a couch! Two other En-suites with walk-in closets
OPEN HOUSE
📣 175 Wimbleton, Birmingham on Sunday 12:00 PM to 2:00 PM with Leslie
BIRCHWAY (3)
This 3 bedroom 2.5 bath spacious ranch overlooks the scenic Rouge River. You’re within easy walking distance to all of Birmingham’s amenities, Poppleton Park, the Farmer’s Market (every Sunday), and even a large grocery store. Great Poppleton Park neighborhood, easy commute to downtown Detroit, less than 30 minutes. Wood floors through out and open concept spacious kitchen, living and dining area with 2 fireplaces. The home is very well insulated, low utility costs, perfect condo alternative with maintenance free landscaping including sprinkler system. 2 car attached garage. All season back porch and decks so you can sip your morning coffee or have dinner with family and friends while surrounded by nature. Handicap accessible. Updated kitchen and baths in 2003.
OPEN HOUSE
📣 8950 Morning Mist Dr, Independence Twp on Sunday 2:00 PM TO 4:00 PM with Paul
BIRCHWAY (5)
Gorgeous, spacious, open floor plan, this stately home is an entertainers dream! The open first floor boasts cathedral ceilings in the Living room and Great room, formal dining room, cozy den and a spacious back hallway complete with a lav, and large laundry/mudroom. Upstairs has 3 spacious bedrooms and a master bedroom ensuite complete with huge walk-in closet and jetted tub. Finished lower level is right out of a 1950’s diner! Snack bar complete with a vintage chrome soda fountain dispenser, with commercial water carbonator and chiller. Huge TV/Movie home theatre area and a full bathroom, yet still tons of storage space too! Professionally landscaped yard with low voltage lighting, fountain and stone steps leading from the deck down to the lower level walk-out basement. Private, relaxing, quiet, treed backyard overlooks small pond at the end of the property. This home has been meticulously maintained. Natural gas generator. BATVAI
For details and more photos, click here.

Open House Schedules for weekend of September 8 and 9

OPEN HOUSE
📣 7605 Devins Ridge, Independence Twp 48348 on Sunday with Gayle
12 pm to 3 PM

7605_Devins_Ridge

218061113

Bridge Valley Family Resort. All on 1.5 acre lot. Estate boasts 5 bedrooms, 2 owner suites with private baths, jetted jacuzzi and showers. Two story great room with surround sound, gorgeous built ins, fieldstone gas fireplace and large windows for beautiful views of nature. Open concept kitchen perfect for entertaining. Home has granite and tile baths throughout. Customized laundry and mudd room with granite sink, cabinet and cubbies. Lower level is a finished waikout with large family room surround sound, stone gas fireplace built-in cabinetry. Full bath, ample storrage. Exterior has an in ground heated 36×18 pool with diving board. Breathless landscaping and ample yard to play. . Much, much more.

 

OPEN HOUSE
📣 3007 N. Vermont RO on Saturday with Leslie
3 PM to 5 PM

3007_North_Vermont_Avenue

218075412

Immaculate Royal Oak brick bungalow in popular Red Run Heights neighborhood just blocks away from Red Run Golf Club and Red Run Park. This move-in ready 3 bedrooms home has 2 full baths, all beautifully updated in 2015. Kitchen offers granite counter tops, stainless steel appliances and ceramic floors. Beautiful hardwood floors on main level with a spacious family room that includes a gas fireplace and tons of natural light. Spacious Master bedroom has beautiful master bath and lots of closet space. Large finished basement for additional living space. Fully landscaped fenced in back yard with mature trees and large deck, perfect for outdoor entertaining. Welcome to your new home! Licensed agent must be present at all showings.

 

OPEN HOUSE
📣 3798 Newport Way Drive, Waterford Twp 48329 on Sunday with Steve K
12 PM to 2 PM

3798_Newport_Way_Drive (1)

218023288
Come see this beautiful open floor plan Snug Harbour Ranch featuring 85′ on All Sports LOON LAKE. Enjoy privacy and security in this private gated community. This is a perfect home for entertaining with its huge kitchen and Great Room spaces. Relax in your Master Bedroom with beautiful lake views. Your ensuite features ceramic tile, a large soaking tub and glass walk-in shower. Enjoy awesome summer activities in your FINISHED 2000+ sqft walk out basement. This space will amaze you with it’s versatility and charm. Your glass block custom built bar will be enjoyed by everyone. The oversize lower level bedroom and full bath is perfect for your summer activities. Your garage is listed as a 3 car. You’ll find that and much more making this space perfect for a car enthusiast.

OPEN HOUSE
📣 102 E Hickory Grove, Bloomfield on Saturday with Chris

12 PM to 2 PM
102_East_Hickory_Grove

218047895

Totally renovated in the last few years. Gorgeous new kitchen with white wood cabinets with soft close doors, quartz countertops and patterned aluminum backsplash. New laminate floor that looks like ceramic tile! Refinished, original wood floors on first floor, new carpet upstairs and in lower level, new Theratru doors and Oxbow windows. Freshly painted in soft, neutral palate. Updated baths. Upstairs bath is a European “wet room” which makes it 100% waterproof! Barrier free shower and euro modern fixtures. Three spacious bedrooms. Lower level is partially finished with small bar area and large rec. room. One car shared garage. Private rear patio. Furnace has had major overhaul, only the body is old. Amazing location!! Close to downtown Birmingham and easy access to I-75 too. Award winning Bloomfield Hills schools.

OPEN HOUSE
📣 4021 COMMERCE Road, Orchard Lake 48324 on Saturday and Sunday with Chris

3PM to 6PM

OH_4021_Commerce_041518

218010679
Seller will entertain offers between $2,000,000 – $2,350,000. The pictures are good but you need to see this house to experience it. Overlooking the most sought after lake in Michigan, is this Aspen inspired gem. Breathtaking views of the lake from every room, the entire back of the house is glass. Spectacular unconventional design, two grand staircases with wood/iron detailing, and an elevator that goes to all 3 levels. Soaring 2 story Great Room with detailed moldings, floor to ceiling windows. Barrel roof and wood trim detailing in family room and spacious library with gorgeous Brazilian hardwood floors and 3 walls of bay windows. Amazing kitchen with Cherry LaFata cabinets, enormous granite island with second sink, SS top-of-the-line appliances including Thermador 8 burner oven/stove. Grand master suite with his/hers closets, huge bath with euro shower, separate jetted tub, his/hers vanities with space left over for a couch! Two other En-suites with walk-in closets

OPEN HOUSE
📣 175 Wimbleton, Birmingham on Sunday with Chris

12 PM to 2 PM

OH_175_Wimbleton_Birmingham (2)

218011832

This 3 bedroom 2.5 bath spacious ranch overlooks the scenic Rouge River. You’re within easy walking distance to all of Birmingham’s amenities, Poppleton Park, the Farmer’s Market (every Sunday), and even a large grocery store. Great Poppleton Park neighborhood, easy commute to downtown Detroit, less than 30 minutes. Wood floors through out and open concept spacious kitchen, living and dining area with 2 fireplaces. The home is very well insulated, low utility costs, perfect condo alternative with maintenance free landscaping including sprinkler system. 2 car attached garage. All season back porch and decks so you can sip your morning coffee or have dinner with family and friends while surrounded by nature. Handicap accessible. Updated kitchen and baths in 2003.

 

For more details and photos,  here.

Open house schedules this Labor day weekend

Choice properties to visit this weekend hosted by Chris

OH_4021_Commerce_041518 (1)4021 Commerce Road, Orchard Lake
on Friday 5:30 to 7:30 pm
Saturday 10:00 am to 12:00 pm
Sunday 4:00 to 6:00 pm

Seller will entertain offers between $2,000,000 – $2,350,000. The pictures are good but you need to see this house to experience it. Overlooking the most sought after lake in Michigan, is this Aspen inspired gem. Breathtaking views of the lake from every room, the entire back of the house is glass. Spectacular unconventional design, two grand staircases with wood/iron detailing, and an elevator that goes to all 3 levels. Soaring 2 story Great Room with detailed moldings, floor to ceiling windows. Barrel roof and wood trim detailing in family room and spacious library with gorgeous Brazilian hardwood floors and 3 walls of bay windows. Amazing kitchen with Cherry LaFata cabinets, enormous granite island with second sink, SS top-of-the-line appliances including Thermador 8 burner oven/stove. Grand master suite with his/hers closets, huge bath with euro shower, separate jetted tub, his/hers vanities with space left over for a couch! Two other En-suites with walk-in closets

 

 

102_East_Hickory_Grove (1)

102 E Hickory Grove, Bloomfield Hills
on
Saturday 1:00 to 3:00 pm
Sunday 10:30 am to 12:30 pm

Totally renovated in the last few years. Gorgeous new kitchen with white wood cabinets with soft close doors, quartz countertops and patterned aluminum backsplash. New laminate floor that looks like ceramic tile! Refinished, original wood floors on first floor, new carpet upstairs and in lower level, new Theratru doors and Oxbow windows. Freshly painted in soft, neutral palate. Updated baths. Upstairs bath is a European “wet room” which makes it 100% waterproof! Barrier free shower and euro modern fixtures. Three spacious bedrooms. Lower level is partially finished with small bar area and large rec. room. One car shared garage. Private rear patio. Furnace has had major overhaul, only the body is old. Amazing location!! Close to downtown Birmingham and easy access to I-75 too. Award winning Bloomfield Hills schools.

 

 

807_East_Fourteen_Mile_Road (2)

807 E Fourteen Mile, Birmingham
on
Saturday 3:45 to 5:30 pm
Sunday 1:30 to 3:00 pm

Charming Birmingham ranch with tons of potential! Open and spacious floor plan. Two generous bedrooms and a beautiful tiled bathroom. Kitchen boasts lovely blue tiled accents, and all appliances stay! Back door opens to small deck overlooking the large, grassy yard. Oversized one car garage with tons of storage. Ideal location close to downtown Birmingham with it’s shops, restaurants, markets and activities. Nearby Woodward and access to freeways make your commute quick and easy.

For all property details click here.

Home Sales Expected to Continue Increasing in 2019

Freddie Mac, Fannie Mae, and the Mortgage Bankers Association are all projecting that home sales will increase nicely in 2019. Below is a chart depicting the projections of each entity for the remainder of 2018, as well as for 2019.

20180828-STM-ENG

 

 

As we can see, Freddie MacFannie Mae, and the Mortgage Bankers Association all believe that homes sales will increase steadily over the next year. If you are a homeowner who has considered selling your house recently, now may be the best time to put it on the market.

Open House Schedules this weekend of August 19!

Be in our neighborhood this Sunday for the best home opportunities with Leslie and Paul.

3007 North Vermont Avenue, Royal Oak with Leslie
$ 279,000 — New Price!
3 BEDS 2 BATHS 1210 SQ. FT.
MLS # 218075412

 

3007_North_Vermont_Avenue (1)

Open House Schedule :
Sunday August 19 – 2:00 pm to 4:00 pm

Immaculate Royal Oak brick bungalow in popular Red Run Heights neighborhood just blocks away from Red Run Golf Club and Red Run Park. This move-in ready 3 bedrooms home has 2 full baths, all beautifully updated in 2015. Kitchen offers granite counter tops, stainless steel appliances and ceramic floors. Beautiful hardwood floors on main level with a spacious family room that includes a gas fireplace and tons of natural light. Spacious Master bedroom has beautiful master bath and lots of closet space. Large finished basement for additional living space. Fully landscaped fenced in back yard with mature trees and large deck, perfect for outdoor entertaining. Welcome to your new home! Licensed agent must be present at all showings.BATVAI

8950 Morning Mist Dr, Independence Twp with Paul
$ 489,900
4 BEDS 4 BATHS 2966 SQ. FT.
MLS # 218049993

OH_morning_Mist_0715 (1)

Open House Schedule :
Sunday August 19 – 2:00 pm to 4:00 pmGorgeous, spacious, open floor plan, this stately home is an entertainers dream! The open first floor boasts cathedral ceilings in the Living room and Great room, formal dining room, cozy den and a spacious back hallway complete with a lav, and large laundry/mudroom. Upstairs has 3 spacious bedrooms and a master bedroom ensuite complete with huge walk-in closet and jetted tub. Finished lower level is right out of a 1950’s diner! Snack bar complete with a vintage chrome soda fountain dispenser, with commercial water carbonator and chiller. Huge TV/Movie home theatre area and a full bathroom, yet still tons of storage space too! Professionally landscaped yard with low voltage lighting, fountain and stone steps leading from the deck down to the lower level walk-out basement. Private, relaxing, quiet, treed backyard overlooks small pond at the end of the property. This home has been meticulously maintained. Natural gas generator. BATVAI

 

for more details and photos,  click here.

Renters for a Weekend or a While: What’s the Best Use of Your Investment Property?

Renters for a Weekend or a While: What’s the Best Use of Your Investment Property?

The residential rental market is now the fastest-growing segment of the housing market. In the United States, the demand for single-family rentals, defined as either detached homes or townhouses, has risen 30 percent in the past three years.1 And in Canada, rental units now account for nearly one-third of the country’s homes, with particular demand for multi-family units, including apartments and condominiums.2

At the same time, the short-term, or vacation, rental market is also booming. The popularity of online marketplaces like Airbnb, HomeAway, and VRBO has helped the short-term rental market become one of the fastest-growing segments in the travel industry.3

Now, more than ever, there is an abundance of opportunity for real estate investors. But which path is best: leasing your property to a long-term tenant, or renting your property to travelers on a short-term basis?

In this post, we examine the differences between the two investment strategies and the benefits and limitations of each category.

WHY INVEST IN A RENTAL PROPERTY? The Top 5 Reasons

Before we delve into the differences between long-term and short-term rentals, let’s answer the question: “Why invest in a rental property at all?”

There are five key reasons investors choose to real estate over other investment vehicles:

  1. Appreciation

Appreciation is the increase in your property’s value over time. And history has proven that over an extended period, the cost of real estate continues to rise. Recessions may still occur, but in the vast majority of markets, the value of real estate does grow over the long term.

  1. Cash Flow

One of the key benefits of investing in real estate is the ability to generate steady cash flow. Rental income can be used to pay the mortgage and taxes on your investment property, as well as regular maintenance and repairs. If appropriately priced in a solid rental market, there may even be a little extra cash each month to help with your living expenses or to grow your savings.

Even if you only take in enough rent to cover your expenses, a rental property purchase will pay for itself over time. As you pay down the mortgage every month with your rental income, your equity will continue to increase until you own the property free and clear … leaving you with residual cash flow for years to come.

  1. Hedge Against Inflation

Inflation is the rate at which the general cost of goods and services rises. That means as inflation rises, the money you have sitting in a savings account will buy less tomorrow than it will today. On the other hand, the price of real estate typically matches (or often exceeds) the rate of inflation. To hedge or guard yourself against inflation, real estate can be a smart investment choice.

  1. LeverageLeverage is the use of borrowed capital to increase the potential return of an investment. You can put a relatively small amount down on a property, finance the rest of the investment with a mortgage, and then profit on the entire combined value.
  2. Tax BenefitsDon’t overlook the tax benefits that can come with a real estate investment, as well. From deductions to depreciation to exemptions, there are many ways a real estate investment can save you money on taxes. Consult a tax professional to discuss your particular circumstances.

These are just a few of the many perks of investing in real estate. (For more detailed information, visit our previous post: Why Real Estate Investing Makes (Dollars and) Sense. [Link to October 2017 blog post.]) But what’s the best strategy to maximize returns on your investment property? In the next section, we explore the differences between long-term and short-term rentals.


LONG-TERM (TRADITIONAL) RENTAL MARKET

When most people think of owning a rental property, they imagine buying a home and renting it out to tenants to use as their primary residence. Traditionally, investors would use their rental property to generate an additional stream of income while benefiting from the property’s long-term appreciation in value.

In fact, that steady and predictable monthly cash flow is one of the key advantages of owning a long-term rental. And as an owner, you don’t usually have to worry about paying the utility bills or furnishing the property—both of which are typically covered by the tenant. Add to this the fact that traditional tenants translate into less time and effort spent on day-to-day property management, and long-term rentals are an attractive option for many investors.

However, there are also limitations to long-term rentals, which often come down to your ability to control the property. Perhaps the most obvious one is that you do not get to use the home or closely monitor its upkeep (this is different from a short-term rental, which we’ll share in the next section).

In addition, while you can usually generate a steady, predictable income stream with a long-term rental, you are limited in your ability to adjust rent prices based on increasing or seasonal demand. Therefore, you may end up with a lower overall return on your investment. In fact, according to data from Mashvisor, in the 10 hottest real estate markets, short-term rentals produced “significantly higher rental income” than long-term rentals.4

SHORT-TERM (VACATION) RENTAL MARKET

Short-term rentals are often referred to as vacation rentals, as more and more travelers enjoy the benefits of staying in a home while on vacation. In fact, according to Wells Fargo, vacation rentals are steadily growing and predicted to account for 21% of the worldwide accommodations market by 2020.5

Investing in a short-term rental or funding your second-home purchase by renting it out can offer many benefits. If you purchase an investment property in a top travel destination or vacation spot, you can expect steady demand from travelers while taking advantage of any non-rented periods to enjoy the home yourself. In addition to greater control over how your property is used, you can also adjust your rental price around peak travel demand to maximize your returns.

But short-term rentals also have risks and drawbacks that may dissuade some investors. They require greater day-to-day property management, and owners are typically responsible for furnishing the property, upkeep, and utilities.

And while rental revenue can be higher, it can also be less predictable based on seasonal or consumer travel trends. For example, a lack of snowfall during ski season could mean fewer bookings and lower rental revenue that year.

In addition, laws and limitations on short-term rentals can vary by region. And in some areas, the regulations are in flux as residents and government officials adapt to a new surge in short-term rentals. So make sure you understand any existing or proposed restrictions on rentals in the area where you want to invest.

Urban centers or suburban communities may be more resistant to short-term renters, thus more likely to pass future limitations on use. To lower your risk, you may want to consider properties in resort communities that are accustomed to travelers. We can help you assess the current regulations on short-term rentals in our area. Or if you’re interested in investing in another market, we can refer you to a local agent who can help.

WHICH INVESTMENT STRATEGY IS RIGHT FOR YOU?

Now that you understand these two real estate investment options, how do you pick the right one for you? It’s helpful to start by clarifying your investment goals.

If your goal is to generate steady, predictable income with less time and effort spent on property management, then a long-term rental may be your best option. Also, if you prefer a less-risky investment with more reliable (but possibly lower) returns, then you may be more comfortable with a long-term rental.

On the other hand, if your goal is to purchase a vacation or second home that you’ll use, and you want to defray some (or all) of the expense, then a short-term rental may be a good option for you. Similarly, if you’re open to taking on more risk and revenue volatility for the possibility of greater investment returns, then a short-term rental may better suit your spirit as an investor.

But sometimes the decision isn’t always so clear-cut. If your goal is to purchase a future retirement home now to hedge against inflation, rising real estate prices, and interest rates, then both long- and short-term rentals could be suitable options. In this case, you’ll want to consider other factors like location, market demand, property type, and your risk tolerance.

HERE OR ELSEWHERE … WE CAN HELP

If you’re looking to make a real estate investment—whether it’s a primary residence, investment property, vacation home, or future retirement home—give us a call. We’ll help you determine the best course of action and share insights and resources to help you make an informed decision. And if your plans include buying outside of our area, we can refer you to a local agent who can help. Contact us to schedule a free consultation!

The above references an opinion and is for informational purposes only. It is not intended to be financial advice. Consult the appropriate professionals for advice regarding your individual needs.

Sources:

  1. USA Today –
    https://www.usatoday.com/story/money/personalfinance/real-estate/2017/11/11/renting-homes-overtaking-housing-market-heres-why/845474001/
  2. The Globe and Mail –
    https://www.theglobeandmail.com/real-estate/the-market/article-demand-for-rental-housing-in-canada-now-outpacing-home-ownership/
  3. Phocuswright –
    https://www.phocuswright.com/Travel-Research/Research-Updates/2017/US-Private-Accommodation-Market-to-Reach-36B-by-2018
  4. Rented.com –
    https://www.rented.com/vacation-rental-best-practices-blog/do-long-term-rentals-or-short-term-rentals-provide-better-investment-returns/
  5. Turnkey Vacation Rentals –
    https://blog.turnkeyvr.com/short-term-vs-long-term-vacation-rental-properties/August2018DigitalMarketingCampaignSocialMediaImage-1533744828769 (1)