While owning a home has long been considered central to American Dream -it seems that's no longer the case for many.
The shockwaves of the Great Recession are still being felt today, and years later -whether by choice or necessity, homeownership is being postponed, or even ruled out altogether -as countless people are exchanging title deeds for rental agreements.
American homeownership has recently dropped to its lowest level -since the 1960s, at less than 63 percent. Homeownership rates among Millennials -or, those under age 35 -and entering the traditional prime home-buying years, have also hit a record low, at just 34.1 percent.
Meanwhile, rental demand is surging to heights that haven't been seen in recent years. The number of renters has increased by 9 million over the past decade, the largest 10-year gain on record. And in terms of new household formation, renters are on track to soon outnumber home buyers. Between 2010 to 2030 the Urban Institute estimates that there will be 4 million more new renters than homeowners.
All of this sets the stage for a new and very different type of American Dream -one that's quickly rising the ranks, and set to replace homeownership as the investment opportunity of choice for many: Rent Estate(tm) -owning income properties for cash flow as well as long-term equity and appreciation.
Seasoned investors -and everyday homeowners alike are taking advantage of the surging demand for rental properties, and are recognizing the tremendous opportunities that Rent Estate holds. These investors are snatching up single-family properties, or turning their own homes into rentals, and capitalizing on this increasing demand -that's only expected to grow into the foreseeable future.
Rent Estate: Real Estate for Everyone
While real estate has traditionally been something that large-scale investors or business moguls used to amass their wealth, Rent Estate is unique in that it's an investment opportunity that anyone can get started with. Thanks in large part to its low entry point -it's relatively easy to obtain financing for single-family homes, and the chance to earn cash flow every month -this investment is something that almost anyone can get started with.
If you'd like to be a part of this revolution -you should know that it's possible to start -even if you don't currently own your own home. This opportunity is open to anyone who's willing to work hard, do their homework, and put in the effort to make things happen.
With this in mind, let's take a look at some different scenarios, and ways that Rent Estate can help everyday homeowners to reach their investing goals.
Read on to see why the Rent Estate Revolution is for you!
Scenario #1: Late Payments Mean Bankruptcy Looms
A woman is so late on her mortgage payments that it threatens to ruin her credit rating.
For many, the crash of 2008 had a devastating impact -resulting in underwater mortgages and, for many, the inability to pay back their loans. For those who were forced to sell, they received less than they put into the property -forcing many to declare bankruptcy and lose their homes.
Rent Estate, though, offers cash-strapped homeowners a better option: renting out their home, and living in more economical accommodation while still keeping your investment, and using the rental income to pay down the mortgage. With Rent Estate -the woman who was late on her mortgage payments was able to catch up, and save her credit rating, simply by renting out her home. When her property is paid off, she'll have a sizable asset in her name -and will that will have accrued a significant among of equity, and, most likely appreciated considerably over time as well.
Scenario #2: Affordability Issues With Multiple Properties
A recently engaged couple can't afford to sell their respective homes, or live in them, so they face the prospect of starting their marriage in bankruptcy.
Couples need help! The median working-age couple has only saved only $5,000 for their retirement, and an estimated 70 percent of couples have less than $50,000 saved. In fact, according to Social Security, a shocking 90 percent of Americans are currently retiring at or below poverty income levels. The main reason that many are retiring without adequate funds, is because many are working hard to put away cash, when, in fact, building passive streams of income for retirement is a far better way to create and grow wealth.
As you might expect -for the newlyweds, having two homes to their name proved to be a considerable advantage; giving them a great platform from which to begin their foray into Real Estate investing. The couple was able to afford a new home by renting out both of their existing properties -instead of trying to sell them, and being forced to "cash out" -or, worse still, having to accept bottom dollar if they were trying to sell during a down real estate market or an off-season.
Scenario #3: When an Inheritance Ends Up Costing
A family can't find good tenants for the rental home they inherited from their recently deceased father, and now it's costing them valuable time and money.
For some people, an inheritance means that they suddenly become the new owners of a home -a property that, ideally, should be able to provide a passive stream of income. Unfortunately, though, many are inexperienced and unprepared for the amount of time and effort that managing a property requires. Forced to learn things the hard way, they struggle to break even on their property, or worse, even lose money by making poor management decisions.
Fortunately, there's a better way: outsourcing the work to a reputable property management company.
The family in question was able to hire a property management firm to oversee their investment for them, and handle their tenant placement process. This helped them to save time and money -and, also let them to keep their father's prized possession in the family. By turning over the reins to an experienced and professional property management team, they were finally able to start turning a profit on the property.
The Rent Estate Revolution is Here
The fact is that housing is at the center of our lives.
Every big moment has implications for it; including marriage, divorce, death, relocation, new jobs, and retirement.
But here's the thing: each of the scenarios that we've looked at -and countless others, have all been solved by Rent Estate -a solid, long-term, scalable solution that stands in stark contrast to the 'buy and flip' mantra and speculative investing methods of the early 2000s. Instead, Rent Estate is based on solid and growing demand and offers a number of benefits that make it an ideal investment vehicle of choice for the everyday investor.
And if you're just starting out -Rent Estate is a realistic investment opportunity for you at well. Be sure to have a look at Bigger Pocket's Ultimate Beginner's Guide to Real Estate Investing, as well as our helpful resource: 30 Tips for Obtaining Financing for Your Single-Family Home.
Let's take a look at some of the distinct benefits that Rent Estate offers, and see how you can take advantage of this opportunity and apply it to your own individual situation.
Long-Term Cash Flow
The chance to create a long-term reliable stream of cash flow is one of the largest and most valuable benefits of Rent Estate. While many people can't, or prefer not to invest in stocks or shares that are at risk of unexpected dips in the market -rental investments, when made carefully, can offer excellent prospects for long-term cash flow. The average rent rose 22.3 percent in the 50 biggest housing markets between 2006 and 2015. People will always need homes, and evidence is pointing to an ever-increasing pool of tenants that's expected to grow into the foreseeable future.
Equity
Property has traditionally been a good store of wealth -but Rent Estate is unique in that it's the one investment that allows you to have someone else -the tenants, pay down your mortgage for you, helping you to accrue equity in your home.
Appreciation
Over time, most homes tend to appreciate in value. In fact, single-family home prices have consistently risen during every decade since 1940. Long-term appreciation is something that can prove to be an extremely beneficially form of retirement savings -and is something that can benefit anyone -at any stage of life. Forty percent of Millennials say they don't have a retirement strategy in place and Gen Xers have a median savings rate of $70,000, even though most say they'll need $1 million to retire with a similar lifestyle to what they have currently. Baby Boomers -average Americans between the ages of 55 and 64 have only accrued about $104,000 in retirement savings -an amount that equates to just over $300 a month if invested in a lifetime annuity. Having a long-term retirement plan in addition to cash savings is invaluable -and something that's Rent Estate makes possible.
Tax Breaks
Finally, Rent Estate provides the chance for some excellent tax breaks in the form of write-offs and deductions that can add up considerably over time. Available deductions include maintenance costs, advertising expenses, depreciation, travel to and from the rental, mortgage interest, insurance, legal and professional fees, property management costs, and even some taxes. The IRS is on your side as a property investor!
No matter what your financial situation, or how many years away from retirement you are -Rent Estate can provide you with excellent prospects for the future. It's easier than you might think to get started. Thanks to the wealth of information, funding options, and helpful tools that are available today, you too can take advantage of this valuable investment opportunity -and start filling the gap between where you are today, and financial freedom.
As the country continues to transition from real estate to a more accessible investment -Rent Estate, smart investors and everyday homeowners alike are taking advantage of the opportunities that income properties hold, and using them to create a financially secure future. The time to own single-family rentals is now.
The revolution is here -are you ready for it?
This article is a summary of Chapter Four in our new groundbreaking book: Rent Estate Revolution. To discover The Revolution for yourself -and learn how you can benefit from the exciting opportunities that it holds, download your copy or get a free sample chapter to try it today!
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