At Home with Connie Sadowski, Real Estate Expert

Waiting for the mortgage rates to come down before you buy a home may not be a good decision.   If you are correct, and the rates do come down by two percent, the savings you benefit from a lower rate will most likely be devoured by the appreciated price increase.   An example: The 30-year fixed-rate was at 6.33%.  If the rate drops to 4.7% in three years but the price increases by 5% a year, a $400,000 home today, will cost $463,050 three years from now. An increasingly, popular option that more buyers are considering is to purchase the home today with an adjustable-rate mortgage that could give them an approximate 5.00% rate for five years.  Then, refinance to a fixed rate when rates come down.  Not only will the buyer have lower payments with the ARM, but the buyer will also own the home, and benefit from the appreciated prices which will build equity in the home and increase their net worth. Mortgage rates increased over 3% in the first three quarters of this year and in 2022.  Som

THE 1 PERCENT RULE IN REAL ESTATE EXPLAINED Pr Mashvisor  in real estate is and why it can be helpful to investors. What Is the 1 Percent Rule in Real Estate? The  1 percent rule in real estate  states that for an investment property to generate  positive cash flow , the monthly rent should be equal to or greater than 1% of the total investment. Monthly Rent  ≥ One Percent of  Total Investment It is important to note that the total price paid for the property includes not only the purchasing price but also the cost of any upfront renovations or repairs. The purpose of this rule of thumb is to determine if the monthly rent earned from an investment property will surpass its monthly mortgage payment when evaluating potential purchases. At worst, the investor should  break even on the property . In other words, the 1% rule quickly measures an investment property’s ability to produce cash flow. The rule is used by investors to do quick math on rental properties to figure out whether to loo