One component experts use to predict future investment risk is looking at historical data. When it comes to rental property investments, the past decade may be a good indication of what the next decade will look like. The fact that there’s a housing shortage combined with a high rate of millennials and baby boomers preferring renting over owning makes rental property investments very valuable. Now may be the time to seek financing for commercial real estate, since the projections indicate the next decade could bring even more value to rental property investors than the past decade.
What’s Driving Rental Property Growth?
A large percentage of the millennial population prefers renting over owning for various reasons. And an increasing amount of the baby boomer population is also opting to rent rather than own. The strong economy with a steady increase of job opportunities has led to the need for more housing. Job opportunities are expected to increase, but the interest in owning a home is not expected to increase. The projected increase in rental property investments is making investors take a closer look at commercial mortgage rates to see how it could fit into their portfolio.
Growth Won’t Slow Any Time Soon
The only thing that could potentially slow down the growth of rental properties is the shortage of construction workers. However, more than 200,000 units were completed across the country in 2017, and hundreds of thousands more are still under construction. Of course, the location of these rental properties is a significant factor, as people want to live in an area of stability with plenty of job opportunities. Commercial mortgage rates may vary depending on the location, but the higher risk can also equate to a higher reward.
What This Means For Investors
The projected growth of rental property investments is a good sign for investors. Getting a commercial loan real estate investors can work with isn’t difficult, as long as the right resources are used. Working with a trusted commercial mortgage company can help investors secure the lowest commercial mortgage rates in order to reduce risk and create a little stability to their portfolio. With new rental properties opening seemingly every day, the time may be now to make the plunge into making an investment.
Commercial Mortgage Connection ensures investors are treated fairly. We make the process of financing for commercial real estate easier for our clients, which is typically not the case with large banks. Our network of private lenders is extensive and we work closely with them every single day in order to provide you with a customized solution to your investment needs. If you’re ready to pursue rental property investments or have any questions at all, don’t hesitate to contact us to schedule a consultation with one of our experts.