Morgan Stanley Research released its latest real-estate report, "Housing 2.0: The New Rental Paradigm" to provide market insights to investors. It's engaging to understand that the research team observes how more USA citizens have become renters rather than homeowners, attributing to different factors in the economy.
The report states:
"Across the country, more USA citizens are becoming home renters, and fewer North Americans are becoming owners. The start of the rentership society is on us. But all renters are not equal "of the approximately 40MM rental housing units in the country (representing approximately $6 trillion in asset worth), about half are multi-family and half are single- family."
And this is good news for investors in real estate like you! With such powerful demand coming from renters and cheap prices available on homes, there's just about no way that you might miss out on the investment property market today.
Chris Mayer, handling editor of Agora Financial, supports these observations. He states, "...rental rates have been rising. In 12 of the 27 largest metropolitan markets in the U.S, it is less expensive to buy than to rent."
"In some markets, the gap is pretty wide (e.g. Atlanta, where monthly rental rates average $840). A mortgage payment? Principal, interest, taxes and insurance mount up to a relatively paltry $539. So there is a great chance there for investors," Mayer notes.
The Morgan Stanley report concludes that if you'd like to defy the prevailing market malaise, it might be more rewarding to take a position in single-family properties where you can use as rentals. Such property can counter the effect of the housing bubble and further plunge in property values. More so , single-family rentals are also good for both equity and debt investors according to the report.
Although single-family houses might cost more than some other sorts of properties, more investors in real estate like having greater privacy in the properties that they invest in. Single-family homes can also be expanded and most of them belong to communities with a householder's association.
Best of all, single-family houses allow a real estate investor to hedge better. When it is a buyer's market, hires surge and one's cash flow also increases. On the other hand, when it's a seller's market, the property's price rises. This leaves the investor with the choice to sell the property for a (massive) profit or refinance the property to take some money and/or get a better mortgage interest rate.
With reports like this, it's pretty obvious that one can gain an advantage with rental real estate.
The report states:
"Across the country, more USA citizens are becoming home renters, and fewer North Americans are becoming owners. The start of the rentership society is on us. But all renters are not equal "of the approximately 40MM rental housing units in the country (representing approximately $6 trillion in asset worth), about half are multi-family and half are single- family."
And this is good news for investors in real estate like you! With such powerful demand coming from renters and cheap prices available on homes, there's just about no way that you might miss out on the investment property market today.
Chris Mayer, handling editor of Agora Financial, supports these observations. He states, "...rental rates have been rising. In 12 of the 27 largest metropolitan markets in the U.S, it is less expensive to buy than to rent."
"In some markets, the gap is pretty wide (e.g. Atlanta, where monthly rental rates average $840). A mortgage payment? Principal, interest, taxes and insurance mount up to a relatively paltry $539. So there is a great chance there for investors," Mayer notes.
The Morgan Stanley report concludes that if you'd like to defy the prevailing market malaise, it might be more rewarding to take a position in single-family properties where you can use as rentals. Such property can counter the effect of the housing bubble and further plunge in property values. More so , single-family rentals are also good for both equity and debt investors according to the report.
Although single-family houses might cost more than some other sorts of properties, more investors in real estate like having greater privacy in the properties that they invest in. Single-family homes can also be expanded and most of them belong to communities with a householder's association.
Best of all, single-family houses allow a real estate investor to hedge better. When it is a buyer's market, hires surge and one's cash flow also increases. On the other hand, when it's a seller's market, the property's price rises. This leaves the investor with the choice to sell the property for a (massive) profit or refinance the property to take some money and/or get a better mortgage interest rate.
With reports like this, it's pretty obvious that one can gain an advantage with rental real estate.
About the Author:
Marco Santarelli is a backer, writer, and founder behind Norada Real-estate Investments - a national real-estate investment firm offering turnkey investment property in expansion markets countrywide. He is also the original writer of The New Rental Real Estate Paradigm.
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