With interest rates at historic lows, a sizable number of real estate investors are considering expanding their portfolios. However, interest rates aren’t the only factor to consider when investing during the COVID-19 coronavirus pandemic.
Factors to Consider Beyond Interest Rates
In addition to shopping around for the lowest interest rates, you should consider:
Your financial goals.
Are you hoping to earn extra income from rent checks, or are you planning to make improvements and sell the property for a profit in a few years? Knowing what you hope to accomplish will help you avoid unnecessary risks.
Can you afford taxes, association dues, maintenance, repairs, and other associated fees without causing undue financial hardship? Think carefully about whether there are any COVID-19 risk factors that might change your finances after the purchase.
The strength of the neighborhood.
Cities with weak economic foundations before COVID-19 are more likely to struggle to bounce back from the pandemic. Ideally, you want to invest in growing metros with diverse economies and an affordable cost of living. Areas associated with healthcare and technology companies should be of particular interest.
Due Diligence Is Key
Pandemic-related restrictions have made many aspects of due diligence look different than what they were before COVID-19 hit. For example, appraisers are still working because they are considered critical infrastructure employees—but initiatives have been implemented to reduce the need for on-site appraisals. In some cases, there may only be a desktop appraisal that involves using market research, public records, and the MLS listing to determine the property value.
Working with an experienced real estate attorney can help you protect your interests during COVID-19. Your attorney can review documents and explain if there are any pandemic-related changes that might be a cause for concern. This provides the peace of mind you need to proceed with confidence.
Let Us Help You Plan Your Investment
The Alperin Law team is available seven days a week to assist with residential or commercial real estate transactions in Virginia or North Carolina. Contact us online, or call our Virginia Beach office at 757.490.3500 to learn how we can be of service. We serve all communities in Eastern Virginia, including Virginia Beach, Chesapeake, Norfolk, Portsmouth, Suffolk, Newport News, Isle of Wight County, Hampton, the Eastern Shore, and Northeastern North Carolina, including Currituck, Elizabeth City, and the Outer Banks.