Published On: January 28, 2021
Published by:
Entrust Capital Funding
The low mortgage interest rates of 2020 continue to be all the rage. The interest rates in the second half of the year went as low as 2.7% and this led many prospective buyers, to make the leap and start searching for their home. The economy also took many low blows, as small businesses across the country have had to close their doors.
For small business owners and entrepreneurs, it’s been a difficult year to navigate, but it’s not all lost. Here at Entrust Capital Funding, we write a lot about the entrepreneurial spirit and how it relates to real estate investors. So while there are many uncertainties and unknowns, the year 2020 taught us that that is always the case.
The pandemic changed the business landscape, but just as some businesses flourished, others had to adapt, reassess, and maybe even start over. For people looking to find lucrative opportunities, this presented a ripe time for launching a new venture.
Forbes magazine points out that while the pandemic put a lot of businesses in jeopardy, it is nothing new to see new types of businesses or a resurgence of old models when there’s a sea change. The argument points to several major enterprises that began during difficult economic times.
During the recession of 1957-1958, the first Hyatt Hotel opened and rose to great successes. Microsoft was founded during the oil embargo of 73-75. The years following the 2008 housing bubble saw the emergence of popular startups like Uber and Airbnb. Perhaps these society-altering events force people to realign their thinking and change consumer needs and demands. As we slowly see our society return to ‘normal,’ there are likely to be permanent changes.
As anyone in real estate will confirm, the housing market has been smoking this year. In the El Paso area, reports of hungry homebuyers running out of houses to buy made the rounds in the real estate community. A KFOX report as late as Sept of 2020—when El Paso was considered a hot spot for the pandemic—people continued to buy homes. The data pointed to more than 30 homes sold per day during August in El Paso county. The Fall made for the biggest home growth that many in the business have seen for many years.
The main reason is low mortgage rates but also people who found themselves stuck at home or paying exorbitant rents, deciding that investing toward their own place was probably the way to go. Young Millennial buyers seemed to suddenly jump onto the market, as many found themselves to be in an economic position to do so.
According to another report, Millennial and Gen-Z buyers are expected to play a growing role in home purchases and single-family housing starts are expected to grow another 9 percent in 2021. As the younger generation settles down and gets high-paying jobs, they become a good home-buying prospect.
As far as real estate investment goes, it continues to show promise for the upcoming year. This is not only because the real estate market has shown to continue strong even through the harsher pandemic numbers, but because new home construction has slowed and this means that many older homes on the market that need remodeling are being scooped up as investment opportunities. Residential construction continues to face limiting factors. These include higher material costs (such as lumber) and longer delivery times for materials, skill shortages, and more.
If you’re a real estate investor that is looking to flip homes and sell them in the greater El Paso area, this may be your time to jump on the opportunity. With many new home constructions lagging, people that are putting their homes on the market are being incentivized by the rising home prices. Many homes, however, will require major and minor renovations that can make quite the difference on a final sale price.
There are other real estate investing options as well. According to U.S News, the most popular places to invest as the year of 2021 kicks off are:
As the pandemic forces many businesses to close their doors, many commercial spaces that can be transformed will be made available. As changing cultural trends continue thanks to the changing job landscape, the possibilities to turn real estate into a new and lucrative investment continue to remain positive.
Before you can invest in real estate, you need to have a plan and some idea of how to obtain the funds necessary. Sometimes it can be harder than it sounds, but with Entrust Capital Funding, we can provide you with quick answers about your qualification to obtain a loan from us. We operate in El Paso and are helping many entrepreneurs start their enterprises with real estate and housing investment. Call us today and find out more.
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