Win to Investors and Tenants by triyaninovitaayu


									                          Win to Investors and Tenants

Ever since home prices have taken a swan dive and decreased more than 50% in many
metropolitan cities, millions of people have been left with the unfortunate 'foreclosure'
tag on their once dream home. These millions of families throughout America did not just
pack their bags and move to Canada, Mexico, or some other foreign nation they stayed in
their home towns and simply switched from being an owner to being a renter.

The normal American thought of 'apartment renters' are typically younger, early
established people who are just beginning to spread their wings into adult life. However
according to the U.S. Census Bureau the age demographic has increased along with the
size of families living in apartments and rental properties. With such an increase in
demand for rental properties, the 'gold rush' of properties in America for investors is at an
all time high. Being able to purchase properties for fractions of previous values with a
large capitalized net return presents a golden opportunity for investors.

It is estimated that due to the foreclosure crisis there will be 3 million former
homeowners switching to renting single family homes within the next 3 years. In other
terms, 3/4 of those who have faced foreclosure will be renting single families post
foreclosure. Fannie Mae (sourcing U.S. census) says that the single family home rental
market was growing faster than ever between 2005 and 2010, however the continued
growth certainly is unprecedented.

With the incredibly lucrative returns upwards to 16% Net Yearly, there are private equity
and capital companies investing billions into these housing markets to capitalize on the
high returns and long term growth factors.

These single family rental homes are no longer looked upon as 'temporary' residences for
those who rent them with the notion of the owner sooner or later moving back since they
are strictly investment properties. Many renters make the house they are living in a 'home'
as you would look upon it. Although it is common to see tenancy agreements to range
from 12 to 24 months, the length of stay is going to be increasing by years at a time as
children settle into the local schools and the natural home presence settles in.

Benefiting More Than Just Investors

When a house is in foreclosure the effects are felt more than by just the unfortunate
previous owner but the ripple effect is felt by the entire neighborhood. Renters not only
help the investor make money but also increase the overall value and morale of the
neighborhood. Rather than a house sitting vacant with weeds growing, unsightly plants
and bushes expanded there is now respectable families living there not only taking care of
the property but doing minor improvements to increase the houses appeal.

Sooner or later, it is inevitable that those who faced foreclosure will in fact own a home
again. A recent survey from 'Harris Interactive' commissioned by Coldwell Banker found
that 83% of renters want to own a home. No matter how comfortable and happy you may
be in a rental property, there is no satisfaction as obtaining what many would call the
"American Dream". When this transition begins to happen many investors will begin to
see a diminish in demand in rental property, however this is when the large benefit of
owning property becomes more foreseeable. Capital appreciation to some is more
valuable than any annual rental yield, and when demand for home ownership begins to
rise, the value of their investment property will follow respectively.

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