Make way for the ultra wealthy, because they are becoming the home owners for Americans today. Even Americans who had stable jobs just a few years ago were victims of salary cuts, and had to foreclose their home. Even if their salary’s have since recovered, bad credit prevents them from buying. Now there’s a new scenario to deal with – even if their credit has recovered and their salaries have as well, the home may already be purchased by an investor.
In some neighborhoods in Phoenix over 38% of homes were purchased by investors who are making huge profits on real estate. Why are these investors making so much money and buying up so much real estate (hence, squeezing out home buyers from the purchasing picture), because….
Pop quiz: It is less expensive to ____ in 98% of the country than it is to ____?
Answer: It is less expensive to rent in 98% of the country than it is to rent?
For an investor, it is a no-brainer. Buy a home, rent it out, and you are going to be making much more money than what that home actually would cost – even if it required financing and other expensive fees, it is still more affordable to buy and have a renter; especially because the renter will still have to furnish the home, pay the utilities, and many other fees.
What does this mean for Joe-Shmo who is looking to buy a home?