Start Investing in Real Estate Houses
Real estate houses for sale are one of the best investment options available because generally the real estate homes appreciate by 4 to 5% every year. Some years the appreciation may be high and some other years, the appreciation may not be much. The appreciation is dependent on the region, locality or neighborhood, the interest rates on the loan, economy and others.
Five percent may sound very low to you but let's take an example to show how much it can really be. Out of the various real estate houses for sale, you bought a house at $200,000 on mortgage. You made a down payment of $40,000, which is an investment. If we take the appreciation at 5% annually then the increase in value in the first year will be $10,000. This means that for an investment of $40,000, you have earned $10,000, which is 25%.
If you have planned to buy a real estate property for sale then most probably you have thought about a mortgage. Always remember that you need to do a double check on the mortgage rates otherwise, you will end up paying more. The current mortgage rates are 5.84% for a 30yr fixed mtg; 5.61% for a 15yr fixed mtg; 6.08% for a 30yr fixed jumbo mtg; 5.62% for a 5/1 ARM; and 5.75% for a 5/1 jumbo ARM.
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Cost variation in the Market
The cost of a real estate house for sale is dependent on its location. The National Association of Realtors has come out with a list of all the real estate hot spots and cold spots. According to their study, the median price for a real estate house for sale in New York was $218,000 in November 2006 as compared to $225,000 in November 2005. This means that there has been a depreciation of 3.1%. So according to the list created by the National Association of Realtors, New York was a cold spot in 2006.
They also reported that in November 2006, there was a fall in the total housing inventory levels by 1.0 percent and there were 3.82 million real estate homes for sale. The good news is that according to forecasts the sales rate will improve during the first quarter in 2007. Another shaky market of 2005 was Phoenix. Phoenix ended up with an inventory of more than 38,000 real estate homes for sale. The year 2006 went through a wave of uncertainty. There were good times in the real estate market as well as bad. There were 169,000 real estate houses for sale and this was quite an increase. The total inventory for real estate homes on sale went down by an estimated 6.3 months supply in November as compared to 6.7 months in October and 7.2 months in July.
In 2006, the Brooklyn real estate saw a shift in the prices. Real estate houses for sale climbed by 10 percent and the median for 2006 rested at $550,000. Some of the hot spots in Brooklyn include Cobble Hill, Park Slope, and Brooklyn Heights. If you are looking for cheaper properties than real estate try our listings of foreclosures membership.
