The Economic Case for Rental Properties in Pinehurst

With home prices low and financing costs at historic lows,now is the time to consider investing in a rental property.  Rents are at all time highs creating a great investment opportunity.

Consider this very real example:



1240 Morganton Road, Pinehurst is currently listed for sale for $165,000.  

Assume:

You can buy it for $158,500 (96% of list price).  
You can finance 80% of the purchase price at 4.25%, $126,800 mortgage and $31,700 down payment

Your monthly mortgage cost is $621.60 + $110 taxes + $75.00 Insurance = $806.60 total monthly cost

This home has been listed for rent at $1,300.  Your potential monthly net is $493.40

This generates a return on invested cash of 18.6%.   Plus you get the tax benefits associated with rental properties and the potential increase in value of the home as real estate prices increase.

This is not a special case, there are hundreds of opportunities just like this across the market.   If you have the capacity to qualify for a mortgage, this is a great time to buy real estate for investment purposes.  Where else can you get a comparable return while owning a real tangible asset.

This analysis ignores the potentail windfall associated with short term rentals relating to the 2014 US Mens & Womens Opens to be held in Pinehurst.  This specific home could rent for as much as $15,000 to $18,000 during this two week event.

Bob