This is how home price appreciation is affecting rental owners.
In the last ten years, housing prices have skyrocketed, especially in Texas and San Antonio. Over the past three years, the average price for a home has gone from $240,000 to $365,000.
What does that mean for rental property owners? For one thing, it means that you are generally making money in a few different ways. You’re earning on that appreciation, on the rise in rents, getting your mortgage paid, and finally, through tax benefits. That’s not all cash that’s flowing into your bank account, but your wealth is nevertheless increasing.
"Housing prices have been skyrocketing, especially in Texas and San Antonio."
With that appreciation also comes an increase in lease prices, though we see about a year of lag between the two. This happens more and more as people are priced out of buying homes.
So if you own rental properties right now, you are situated in a really good place, financially speaking. Remember that investing in real estate and getting wealthy is a marathon, not a sprint. While we see appreciation in home prices and rents, we’re also seeing increased prices in the cost of material and labor, which can cause some short-term pain if you are renovating or remodeling. Just keep in mind that you’re still coming out ahead in the long run.
If you have any questions about this topic or investing in real estate in general, please feel free to reach out to me by phone or email. I would love to help you out.