Working from home is part of the new normal these days. That means suburban residential real estate investing is still a good bet for those who are holding apartment buildings or rental homes where there are others working from home.
- More people are working from home than ever before
- COVID-19 has changed the work environment
- Many are looking to continue working from home
Real Estate & The New Normal
As more people than ever before are working from home, people are adjusting to having their work lives in their personal space. Setting up the home office can be a challenge but there are resources available to help with advice and guidelines.
Some simple steps to help include finding a comfortable space, with natural light and fresh air. Adequate flat surfaces for work needs are important as well. Artificial light can augment and brighten up additional areas. Silence or sound, depending on how work is best accomplished.
With more than half the US population working at home, it can be a struggle to find the space, with people reportedly using walls, floors and couches to work from. And as the pandemic continues and unrest spreads throughout the country, more and more workers are hoping to continue working from home even after those situations resolve themselves.
Suburban Residential Real Estate
Workers in places like San Francisco and New York, where rents are high, may finally begin looking for homes to own. Those homes, however, may not be where their jobs are. Remote working is changing the face of homeowners and renters as well.
Companies from Facebook to Nationwide are experiencing large numbers of remote workers, as the pandemic and civil unrest provide a backdrop making commuting and office dwelling unsafe. Many of the large companies are contemplating allowing workers to remain remote, which means the actual location can vary for each individual.
Home ownership may therefore increase, as renters begin looking for properties to buy. Investing in real estate properties, therefore, can be a good opportunity. Whether owning a rental home, flipping houses, or holding apartment buildings, it can be a great time to own real estate and make investments in those properties.
With so many Americans working from home, it can be tempting to make the home office more palatable. And real estate is, as usual, coming in as a winner in terms of investments. From owning rental homes to owning apartment buildings, real estate is a great way to generate steady cash flow and asset appreciation for self-directed IRA investors.
A Self-Directed IRA through a passive custodian is a traditional IRA that allows you to make IRS approved investments using your retirement funds. Investments you can purchase with a Self-Directed IRA include alternative assets, such as real estate, as well as traditional assets, like mutual funds.
Real estate investment in rental homes and apartment buildings, and improvements made to them, can help investments increase in value. This means when the holder hits retirement age they can take more money out to live on.
Why Use a Self-Directed IRA to Invest in Real Estate?
With a Self Directed IRA LLC you can invest in many types of real estate . This can help diversify your portfolio beyond traditional stocks, bonds, and funds, and may allow greater protection against volatility. You can consider rental properties, investment opportunities, office buildings, and more, investing in what you know best and are most interested in.
Your investments can grow tax-free, depending on the type of account you hold and what your strategy is. And if you plan on retiring in the home you’ve purchased, you can rent it out and then distribute it from your Self-Directed IRA according to your plans. Remember, you will owe taxes on any distributions from the plan. Distributing your house in one shot will come with a big tax hit. Alternatively, you can distribute a little out of your IRA at a time. However, you cannot utilize the house until it is fully distributed from your plan.
While the COVID-19 pandemic is causing concerns among buyers and sellers regarding actually looking at homes, it can be a great time to stage a location and list the properties online. Online platforms like Zillow and Redfin may be where millenials and zillenials look for rental properties as well as homes to own, given the online consumption rates for their generations.
When looking to buy or sell suburban residential real estate, location is, of course, still key. Remote workers may be willing to step away from crowded apartments and four roommates, but they still want to take advantage of their living location. Making purchases of homes to flip, apartments to rent or sites to sell, it can help to be in a great area, with amenities attractive to home buyers.