Effie Avsker

When you buy a house, you are committing to a long-term relationship.
The purchase price of the house is fixed once you pay it and won't change for the entire period of the ownership. The mortgage, on the other hand, can be refinanced when the rates go down. Therefore, when contemplating to buy a house, the purchasing price is much more important to consider than the temporary mortgage rates.

Thank you to all who came to our seminar this afternoon! I hope it was valuable for you.

Special thank you to Evan Swanson for the great, informative presentation.

See you all at our next seminar!

Swanson Home Loans, Evan Swanson NMLS # 120856

Join Swanson Home Loans, Evan Swanson NMLS # 120856 and me, to discuss and learn more about investing in real estate.
Register here: https://www.eventbrite.com/e/investor-seminar-tickets-506586763647

𝐈𝐭'𝐬 𝐚𝐥𝐥 𝐚𝐛𝐨𝐮𝐭 𝐧𝐮𝐦𝐛𝐞𝐫𝐬

Investment is a business.

When we buy a home, we tend to be emotional. When we buy real estate for investment, we treat it as a business transaction and like with any other business, we don’t want to be too emotional about it.

As with any business- the numbers should work out. It is very important to write down the numbers on a paper (or rather a spreadsheet) and learn what they tell us. If the numbers make sense, we can continue and further explore the deal. If they don’t, we should keep looking.

In my last post I got an important question and I thought that the answer would be interesting to a wider audience, so I decided to repost this answer as its own post:

We always tailor our solution to our personal circumstances and needs. Obviously, if my budget for housing is ~1,000$/ months, I will not try to buy a Million $ mansion, nor will I try to rent one for 5,000$/ month. So, let’s try a small exercise. Let's assume that I love an urban lifestyle, with cafes right on my street and groceries at a walkable distance. I can't afford to buy a house in the downtown, but I might be able to rent a condo, not a large one, but suitable for a couple with no kids (let's assume we are not talking about one of the top super expensive cities). At the same time, I might be able to find a house, maybe a bit further in the suburb or countryside, or even in a different state that sells for ~200,000$. If I manage ~40,000$ down payment, my mortgage payment would be ~1,100$. With rent of ~1,300$, the renter covers my mortgage and expenses, I gain ownership equity in my own house, all the while living the lifestyle that I enjoy and paying the ~1,000$ rent that I can afford.
Obviously, not always this rosy scenario can play out easily. Sometimes we will need to save for quite a while for the down payment itself, sometimes we live in high-cost areas and no matter what, it is difficult to come up with a scheme that we can afford. However, through the years of my life experience, I learned that there are much more options out there than we can see at the first glance. While not always we will find the one that works for us, it is always worth to try and explore, more often than not we can be surprised for the better!
This is not a substitute for a financial advice. I recommend to always consult with a professional advisor that is familiar with your personal situation.

𝗦𝗵𝗼𝘂𝗹𝗱 𝘆𝗼𝘂 𝗯𝗲𝗰𝗼𝗺𝗲 𝗮 𝗿𝗲𝗻𝘁𝗲𝗿-𝗹𝗮𝗻𝗱𝗹𝗼𝗿𝗱?

When we look for home for our family to live, location is always on the short list of our top considerations: distance to work, school boundary, distance to amenities, etc.

Unfortunately, not always can we afford to buy in an area where we would want to live. At the same time, we know that financially, it is much preferable to spend our money on our own mortgage, rather than on our landlord’s.

Fortunately, there is a solution for such situation that can often work. Sometimes it makes sense to rent where you want to live and buy an investment property where you can afford. This way, you still pay a rent to a landlord, but at the same time you gain an equity on your own property, 'locking in' your costs at the current real estate values, protecting yourself from steep increases in the future and take advantage of the tax benefits.

𝗘𝗮𝗿𝗻𝗶𝗻𝗴 𝗮 𝗹𝗶𝘃𝗶𝗻𝗴 𝘃𝘀. 𝗕𝘂𝗶𝗹𝗱𝗶𝗻𝗴 𝘄𝗲𝗮𝗹𝘁𝗵

When we go to our day job, we concentrate on earning for a living (financially of course, there are also other very good reasons to go to work every day 😊). We focus on the essentials of our immediate needs.

When we invest, our focus is on building wealth. Building wealth is for the long term, with the goal of achieving long-term financial security and fulfilling our dreams.

𝟰 𝗙𝗶𝗻𝗮𝗻𝗰𝗶𝗮𝗹 𝗕𝗲𝗻𝗲𝗳𝗶𝘁𝘀 𝘄𝗵𝗲𝗻 𝗶𝗻𝘃𝗲𝘀𝘁𝗶𝗻𝗴 𝗶𝗻 𝗿𝗲𝗮𝗹 𝗲𝘀𝘁𝗮𝘁𝗲:

- 𝑪𝒂𝒔𝒉 𝒇𝒍𝒐𝒘 - After collecting the rent and pay operating expenses and loan payments, there ought to be some cash flow left over.

- 𝑷𝒓𝒊𝒏𝒄𝒊𝒑𝒂𝒍 𝒓𝒆𝒅𝒖𝒄𝒕𝒊𝒐𝒏- Through tenants paying monthly rent, you are able to pay down any loans that might be on the property. Resulting in the tenants paying down the mortgage amount for the owner.

- 𝑰𝒏𝒄𝒐𝒎𝒆 𝒕𝒂𝒙 𝒔𝒂𝒗𝒊𝒏𝒈𝒔 - cash flow and principal reduction are both taxable. The good news is that both can be sheltered from income tax by depreciation.

- 𝑨𝒑𝒑𝒓𝒆𝒄𝒊𝒂𝒕𝒊𝒐𝒏 - Real estate historically increases in value year over year. Investing in real estate properties helps you to build generational wealth.

With winter and holidays ahead, for me, as a local Realtor, this is the time of the year to go and explore, learn the current market, understand trends and prepare for the next investment.

I'm very passionate about real estate. I'm here to support and guide you step by step to your next home or investment property and help you achieve your real estate goals!