Consider investing in the rental market

HUNTSVILLE, Ala. (WAFF) – House prices have risen 27.4% over the past year. If you are considering investing in rental properties, this is a growing market. It’s a great market to invest in with a median rent of $1,000 and a consistently high number of potential tenants, according to Redstone Family Realty.

Teresa Pearce and Kristen Hight of Redstone Family Realty said something to keep in mind is a 1031 exchange.

They say it is a real estate investment tool that allows investors to exchange one investment property for another and defer any capital gains or losses or capital gains tax that otherwise you must pay at the time of sale. Small investors can use it. They say it allows you to sell rental homes that need improvements and buy another one in better condition.

Another option if you are in the market to rent a home is Home Partners of America. Pearce and Hight say they’ve recommended it to many of their clients who are trying to buy a home with an FHA or VA loan. This allows you to rent the house until your finances are in order and buy the house later.

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Be sure to tune in at noon every Friday for the “Financial Friday” segment of WAFF 48.

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