Portland is undoubtedly one of the best locations to dwell in. The liberal and environment-friendly culture of the place has a unique aura that is very inviting. Whether you live abroad and wish to get settled here after retirement or plan to start over, this place can provide you with everything.
But that’s not all!
When you are buying a property at a new place, there are several other factors that need to be considered beforehand. One such crucial factor is finance. Generally, real estate investments are relatively expensive. So, asking yourself a question, i.e., “Do you have the means to afford the property?” is crucial.
Luckily, it is very convenient for people to buy their dream home in Portland, Oregon. Why? Let’s find out!
Reasons Behind Affordability
According to several reports, the mortgage and interest rates are at an all-time low in Portland. The interest rate during December 2021 dropped below 2.7% on a 30-year fixed mortgage. In March, it increased to 3.23%, which means the market is slowly recovering. Yet to purchase a $700,000 house at a 3% rate will be more affordable than buying it at a 6 or 7% rate in the coming future.
Not to forget, there are several lending options available to potential buyers. You can find Mortgage Lenders in Portland Oregon, who have access to numerous mortgage products that fit your finances. And stay updated with the market fluctuations and trends.
Besides that, due to the pandemic, people have saved more money which they used to spend on traveling and other activities. That means it is now easier for potential buyers to make the down payment. Plus, government financial assistance has also made a significant impact on affordable housing.
Nonetheless, purchasing a property is a considerable investment. Thus, along with financing, you need to ensure that you are making a good investment. How? Scroll down to learn!
The Real Estate Market Is Constantly Growing
Every investment is made with the expectations to earn good returns. According to statistics, the Portland real estate market is expected to grow significantly in the coming years. Which makes it a great investment option right now.
The fundamental “law of demand” applies here. As mentioned above, housing is more affordable now than ever before due to the low mortgage rates. This means real estate investors will invest more, which will increase sales. Higher sales will shortly but surely increase the value of the property.
In fact, the city population is expected to increase by 42% over the next two decades. A higher population means higher demand for residential property. Thus, you’ll be able to generate a good rental income.
Furthermore, from the past few years, there has been a deficit in single-family homes. It will probably take several years to build houses to meet this deficiency. Not to forget, there is a reported shortage of buildable land in the city, which implies that the demand and value of the existing homes will be more.
All these figures ensure that you’ll get good returns in the long run by making an investment now.
Benefit Of Tax Deduction
What tax advantages do you get after making investments is also crucial. Fortunately, the National Association of Realtors and the National Association of Homebuilders are constantly working on providing more benefits to homeowners.
In fact, for the tax years 2018-2025, homeowners are eligible for deducting mortgage interest on up to $750,000 of mortgage debt. Also, according to the TAX policy center: Taxpayers can deduct up to $10,000 of their state and local real estate and property taxes. They can also deduce remodeling expenses from the net profits.
Generally, when you sell a “Non-inventory” asset such as a metal or property, you need to pay tax on the capital gain. But now, you can also get exemptions from levied tax.
Furthermore, some federal housing subsidies, including reduced insurance rates, are available to the homeowners. So, you’ll be able to enjoy all these benefits by buying a property in this city.
Helps In Building Net Worth
According to the federal reserve, the tenant or renter in Portland, Oregon, has a net worth of $5,000. However, the net worth of the property owner is approximately $230,000.
This is due to the fact that, from the last few years, residential properties in Portland have been increasing in value by 7-10% per year. Usually, the homeowners in the United States expect an annual increase of approximately 3% in their property values. In such a scenario, a 7-10% gain is a great deal if you’re looking to buy a home in Portland.
Unless increasing your net worth is not a priority, renting for an extended period makes little sense, especially if you can afford to buy a home now. Moreover, the Portland real estate market is currently very stable as well as attractive to investors.
Provides Better Sense Of Security
The average rent in Portland increased by approximately 20% between 2014 and 2017. Also, consider the possibility of becoming homeless if your landlord decides he no longer wants to rent out his property. It would create a very challenging situation for you.
If you’re anxious to buy a home because you are afraid of taking a huge amount of loan, then you need not worry. Why? It is because the mortgage payments can easily be set/fixed for the duration of your loan. Besides, if your circumstances change and you can no longer afford to repay your loan, you have the option to refinance.
Not to forget that buying a property doesn’t change the fact that you can stay in it and make modifications for as long as you desire. Which is usually not possible in the case of renting. Plus, you can leverage your property for future investments.
To Sum It All Up!
All these are crucial aspects of investing in property. And a place like Portland can offer you all these benefits. Even so, it would be best if you took advice from the mortgage lenders before making the final decision.
