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Why is Investing to Rent Properties an Excellent Investment?

According to the National Association of Realtors, the price of existing homes increased by appx 4% annually from 1968 to 2009. Rent prices have historically increased as well.  Yet, your mortgage payment remains the same for all 30 years!

 

That is the reason why real estate is a great long-term investment. One excellent way of investing, is to buy and rent the property for 30 years, pay off the whole mortgage, and sell the house after it has accumulated all those years in value.   You will see that I have shown the calculations/projections for your return on this type of investment, expecting that real estate continues on this long-term trend of increasing value by 4% annually.   

PROPERTIES for
SMART INVESTMENT
FAMILY HOME
SUNRISE, FL

Bedroom/Bath: 4/2

Size: 1650 SQ FT

Type: Single Family Home

HOA: No

Zip: 33322

 

LIST PRICE: $329,999

Suggested Remodeling Costs:  $750

Estimated Monthly payments

(With 5% Down/$16.5K Payment on Mortgage): $2092

Estimated Monthly Rental Value: $2200/Month

Initial Investment:   $17,250

 

Projected value of home in 30 years (with 4% annual increase):  $726,000

Pay Mortgage Off in 30 Years= $726,000 -$17,250

Profit: $708,750

FAMILY HOME
CORAL SPRINGS, FL

Bedroom/Bath: 4/2

Size: 1820 SQ FT

Type: Single Family Home

Zip: 33065

HOA: No

 

LIST PRICE: $359,900

Suggested Remodeling Costs:  $3,300

Estimated Monthly payments

(With 5% Down/$18K Payment on Mortgage)$2,115

Estimated Monthly Rental Value: $2350/Month

Initial Investment:   $21,300

 

Projected value of home in 30 years (with 4% annual increase):  $1,167,298

Pay Mortgage Off in 30 Years= $1,167,298 - $21,300

 

Profit: $1,145,998

FAMILY HOME
SUNRISE, FL

Bedroom/Bath: 4/2

Size: 2100 SQ FT

Type: Single Family Home

Zip: 33323

HOA: No

 

LIST PRICE: $345,900

Suggested Remodeling Costs:  $400

Estimated Monthly payments

(With 5% Down/$17K Payment on Mortgage)$2,027

Estimated Monthly Rental Value: $2450/Month

Initial Investment:   $21,700

 

Projected value of home in 30 years (with 4% annual increase):  $1,118,972

Pay Mortgage Off in 30 Years=  $1,118,972 - $21,300

Profit: $1,097,672

TOWNHOUSE
WESTON, FL

Bedroom/Bath: 2/2

Size: 1100 SQ FT

Type: Single Family Home

Zip: 33326

HOA:  YES- $225/Month

 

LIST PRICE: $235,000

Suggested Remodeling Costs:  $5400

Estimated Monthly payments

(With 5% Down/$11.7K Payment on Mortgage): $1690

Estimated Monthly Rental Value: $1900/Month

Initial Investment:   $17,100

 

Projected value of home in 30 years (with 4% annual increase):  $762,198

Pay Mortgage Off in 30 Years= $762,198 -$17,100

Profit: $745,098