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  • Writer's pictureOleg Lisitsyn

Why Single-Family Homes Are the Future of Real Estate Investment

Updated: Jun 6, 2023

The real estate market has always offered diverse opportunities for savvy investors. From commercial real estate and multi-family units to REITs, there's an array of options to consider. However, a standout choice, both for its financial returns and its resilience, is the humble single-family home. Single-family homes are not just surviving in the investment landscape; they are thriving and here's why they might be the future of real estate investment.

Market Resilience and Predictability

In a volatile economy, the stability and predictability of single-family homes are hard to match. Historically, this sector has shown resilience in the face of economic downturns. Even amidst the Covid-19 pandemic, the single-family home market witnessed growth while other segments faltered. This robustness stems from a constant demand for housing and the emotional connection people have with a space they can call their own.

Strong Rental Demand

The rental market for single-family homes has seen significant expansion in recent years. Factors such as a desire for more space, privacy, and better school districts contribute to this surge in demand, particularly in suburban areas. According to a report from John Burns Real Estate Consulting, the single-family rental market is outpacing both multifamily and apartment growth.

Appreciation Potential

Over time, single-family homes tend to appreciate in value. Although there's no guarantee, historical trends indicate steady growth. Besides the value of the land and property, strategic home improvements can significantly enhance a home's worth, providing an excellent return on investment.

Tax Benefits

Investors in single-family homes can benefit from a range of tax deductions, including mortgage interest, property taxes, operating expenses, depreciation, and more. These tax benefits can significantly improve the return on your investment.

Greater Control Over Investments

Unlike some other forms of real estate investment, investing in single-family homes offers you more control. You can decide on the location, the tenants, the rent, and how to manage and maintain the property.

Despite these advantages, managing single-family homes can be a complex task, especially if you have a diverse portfolio. Partnering with a competent property management company can make this task significantly easier and more profitable.

A reliable property management company can handle advertising, tenant screening, rent collection, routine maintenance, and repairs, among other duties. They have a deep understanding of the rental market, regulatory environment, and best practices for property maintenance and tenant relations.

For example, consider a scenario where an investor has multiple properties across various states. Managing all these assets could be an overwhelming task. However, by leveraging the services of a property management company, not only does the investor reduce their workload, but they can also ensure each property is maintained according to local laws and practices, ultimately protecting and enhancing their investment.

Before choosing a property management company, ensure they have a proven track record in managing single-family homes, a robust infrastructure, and a dedicated team of professionals. The right property management partner can provide local expertise, a wide range of services, and the convenience of having all your property needs taken care of under one roof.

Investing in single-family homes offers a wealth of benefits, and with the right property management company, you can optimize these benefits and secure a prosperous future in real estate investment. Start your journey in the single-family home market today, and prepare for a rewarding tomorrow.

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