The uncertainty brought about by the pandemic has caused many real estate investors to sit and wait. Although through the uncertainty, real estate continues to be the most favored investment by a majority of Americans. In a recent Gallup poll, 35% of Americans cited real estate as the best long-term investment with stocks and mutual funds trailing behind at 21%.
You may be hesitant to jump into the market but if you’re looking to diversify your portfolio, real estate is a great option. It provides a passive income stream with the possibility of substantial appreciation over time.
When looking at where to start, one approach is passive real estate investing. Questions like where to look for listings, what location to choose, and calculating potential return rates, are enough to scare off even the most optimistic investor.
That’s where real estate crowdfunding and passive investing steps in to help.
Passive Investing Using Roofstock
Roofstock is a platform that allows investors to invest in carefully vetted single-family rental properties.
Some specialists like Clint Coons, founding partner of Anderson Law Group, believe that single-family properties are a good investment during the pandemic due to the rent abeyances granted by some state government and municipalities. “Multi-family will be more complicated,” he said.
Using Roofstock, investors can scroll through a number of real estate listings that have undergone a rigorous vetting process. The listings provide information regarding the year the property was built, neighborhood rating, square footage, total return, and more. The platform also provides an analysis of the property’s cumulative cash flow, potential appreciation and equity.
Getting A Loan
Mortgage rates have lowered significantly during COVID-19 making now one of the most opportune times to get a loan. Although, with lower rates came a flood of banks like JPMorgan Chase & Co. (NYSE: JPM) and Wells Fargo & Co (NYSE: WFC) tightening their criteria for loan approval. This change included higher credit scores and down payment requirements.
But for those that are interested and are able to qualify for a loan or have the capital, Roofstock has made the investment process more accessible by opening up their platform to non-accredited investors. No matter your yearly take-home, Roofstock allows you to buy properties at no minimum purchase price, even if you’re a non-accredited investor.
Making the choice to start investing in real estate is a big decision, but it's a decision that has the potential to become a major financial payoff. Figuring out what’s right for you and exploring the different tools that are available at your fingertips are the first steps towards starting your real estate investment journey.
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