Overall, I really don’t know.
I’ve got rental properties in Florida. They’re all happily rented and the cash flow is very strong. But, I owe very little money on these properties. From what I gather in the news media, this is not the case for most US homeowners.
I’m in the process of buying another rental property in Florida. It’s taking a long time. Short sales can do that. But, in the back of my mind, I’m wondering … “Should I?” I’m getting some doubts.
Why?
Well, I’m like most people. I’m susceptible to bad news. And, I hear all the “bad” news coming out of the US and it causes me concern. Should I buy another property during these depressed economic times? Should I take on more risk now? Everything is going fine, why take on another property?
But, I have to learn to resist this negative thinking. Here’s why.
I’m not buying the whole US economy!
I’m just buying one rental property. So, should I be analyzing the whole US economy or should I focus on the deal at hand?
The deal at hand makes a lot of sense. I haven’t seen deals like this in years. I’ve been looking for a deal like this one for a long time. Couldn’t find anything back in the early 2000’s when prices were high and rents were low.
Now, prices are low and rents are the same. In other words, the rents now “look” high. It’s not that difficult to find a rental property that will yield a 10% or better return. Five years ago, a 10% return on residential property was as rare as hen’s teeth.
And, I’m not talking about a trashed home here. I’m talking homes that are move in ready. For instance, the house that I’m looking at buying is already rented. My property manager is already renting it to a long term tenant who has no intention of moving out. The deal stacks up; over 10% return.
And, I ask … why would I not do this deal?
I would. I will.