The idea of buying a home is thrilling and exciting, but it can also be daunting if you don’t have anyone to share the experience with. But that doesn’t mean single homebuyers can’t benefit from real estate; whether you want to buy your own home or invest in rental properties, there are ways to do it all on your own. Follow this guide, and you’ll soon be on your way to making smart investment decisions and improving your financial situation by growing your equity in real estate assets.
Know Your Credit Score
Your credit score is an essential factor in most lenders’ decisions to lend you money. If your credit score is too low, you may not qualify for a loan at all. If your credit score is too high, though, it could cost you because of competition from other lenders. When shopping around for a lender for your single homebuyer investing project, ask about their loans for low-to-moderate-income borrowers or first-time homebuyers with little or no credit history. You’ll get to pay less on closing costs and get lower interest rates than if you had excellent credit and went with a large bank or mortgage company as your lender.
Explore Down Payment Options
An excellent way to get into real estate investing is to buy a home for yourself and rent it out. You can use that as an opportunity to save up for a down payment on your next investment property. If you’re single, you might have more flexibility on how much of your monthly income you can put toward your mortgage payments and/or rental expenses, making it easier to get started. If you live with roommates or family, that means less out-of-pocket expenses for them but more cash in your pocket! That money is easily transferable from one property to another if needed.
Think About Your Future Home and Your Needs
If you’re a single homebuyer and considering your future, you need to consider how much space you need. Do you see yourself becoming a family in 5-10 years? If not, buying a large, expensive house for only one person might not be an economic investment. Instead, it might make more sense to buy a smaller place that won’t require much maintenance. Or buy a larger house and start renting out rooms to fund your real estate endeavors! This way, if you decide to move in five years, then at least you can potentially profit from buying such a prominent place! Either way, it pays to think about your needs going forward and look for homes accordingly.
Consider Flipping Investment Properties
Buying an investment property to resell it—or flip it—is an excellent way for single homebuyers to start investing in real estate. Although you’ll have to do your homework and be prepared for inevitable setbacks, flipping can produce a significant return on investment. Even if your initial flip results in a loss or small profit instead of a considerable gain, you’re still likely to make more money than if you’d rented out that property. However, other risks are involved with flipping properties, so do your research before taking action.
Bringing It All Together!
There are several steps a single homebuyer can take to invest in real estate without anyone else’s money. Make sure to consult a real estate professional before entering into any agreement, and remember that it’s possible to get into real estate for less than $100.
