You want to build a portfolio of Inland Empire properties because you've heard the rental industry is a great investment. At the same time, you keep hearing that current mortgage rates are at a record high, and you're wondering what that might do to your buying power.
Admittedly, this is a tough time for buyers. Does that mean that you should hold off and wait for home loan rates to drop before you start investing? That all depends on your current financial standing.
Read on to learn the latest about 2024 mortgage rates and how to navigate financial planning as a real estate investor.
Current Mortgage Rates and Projections
Unless you're able to buy a property up front and in cash, you're most likely going to aim for a 30-year fixed-rate home loan. This gives you 30 years to pay off your property in monthly installments without worrying about interest rates going up.
According to Bankrate, interest rates have dropped in 2024, but not by much. For the first half of the year, buyers could expect a 7% interest rate. Now, they can expect an interest rate of between 6.5% and 6.7%.
Will it go any lower by the end of the year? This seems unlikely. As for the coming years, it's unclear when, if ever, we'll see historically low interest rates of 2 to 4% like we saw in 2020 and 2021.
Signs You Can Still Buy in 2024
All hope is not lost for home buyers and investors in 2024. However, you should expect to have less buying power until interest rates drop.
The best way to determine your current buying power is to talk to real estate and financial planning experts. When we're talking about investment properties, it's crucial that you only buy if you can afford not to turn a profit on it for at least a year.
What if you buy and interest rates drop in the coming years? You still stand to benefit via refinancing your mortgage.
How to Profit From Rentals With High Mortgage Rates
High mortgage rates mean higher fixed upfront costs. This is going to cut into your net profit as a rental owner, but that doesn't mean you have to stay in the red for long.
Investing in up-and-coming areas is a great way to position yourself for financial growth. Working with real estate experts can take you a step further.
Property managers have the expertise to quickly fix up and market your property to secure great tenants. Skip the trial and error and work with seasoned professionals.
Manage Properties with PMI Inland Empire
Can you navigate the real estate market as an investor facing high mortgage rates? If you have the liquidity to make a long-term investment, you have more leeway than you may think. With the help of real estate experts, you can turn a profit on great properties even in the face of interest rates hovering just below 7%.
PMI Inland Empire is here to make rental property investments simple. We offer customizable and turnkey property management solutions so you can be as hands-on (or off) as you want. Contact us to find out if our approach is right for you.
