Are you looking to invest in real estate and build a portfolio of rental properties? With the Treasure Valley’s red-hot investor market, there is no better time than now to grow your assets. With specific lending options and Idaho programs for helping you acquire property, you can go from renter to owner to investor.
No matter where you are as a potential investor, here’s how you can get started building your portfolio today:
First-Time Home Buyer
The first step towards real estate investment starts with owning your first home. In Idaho, you can look to the Idaho Housing and Finance Association (IHFA) for help acquiring that first property. The IHFA provides financing whether you a purchasing or refinancing a home with several options for loans for home buyers making up to $110,000 per year. Depending on your eligibility, you may also receive assistance with down payments or tax credits worth up to $2,000 a year, as long as the property remains your primary residence.
A good place to start, if you have the space for it, is to build an accessory dwelling unit (ADU) on your property. 75% of the rental income you receive from an ADU can be added to your qualifying assets to help you finance that next property with certain home loans. Plus, renting out an ADU gives you hands-on renting experience with an easy to manage unit, so you can learn exactly what it means to own a rental property. Accessory dwelling units offer the perfect opportunity to build value in your current property, qualify you for financing, and give you the experience you’ll need as a property investor. With the restrictions on ADU size and bedrooms loosened earlier this year, there has never been a better time to add an accessory rental unit to your existing Treasure Valley property.
With some experience under your belt, you can seek out a variety of rental portfolio mortgage loan options. These lenders offer financing for real estate transactions that might not be possible through other funding sources. Lenders like CoreVest provide loans free of capital limitations. These loans also feature a non-recourse option, which will allow you to keep your personal and business assets separate as the loan sponsor. In addition, a portfolio loan lets you consolidate all your loans on rental assets into a single, easy-to-manage account, giving you oversight and full control of your finances.
Large Multi-family Complex Investor
If your rental portfolio is growing fast and you are looking to expand into affordable, multi-family units, the Idaho Housing and Finance Association also has a program that can help. Low-Income Tax Credits match dollars with federal tax liability reductions for the owners of affordable multi-family housing units, either new or recently restored. The IHFA has a limited budget it can award on tax credits, however; last year, it was only $4.4 million. This meant only 8 projects total benefited from these credits. The application process is rigorous, costly, and competitive, but if awarded, these tax credits can be sold to investors for the 10 years during which they are valid to pay down the cost of a rental unit that provides much needed affordable housing to the Valley.
Despite where you are in acquiring or building an asset portfolio, there are resources in Idaho to help you achieve your real estate goals. From owning that first home to giving back to the community through affordable housing units, the Boise area is ripe with investment opportunities and needs more housing options. Now is a great time to invest in your community.
With real estate investment opportunities so desirable in the Treasure Valley, how else can any level of investor jump in and start making money? Have any tips for building a real estate portfolio? Please share your thoughts, comments, and experiences regarding real estate investment with us on social media. We can’t wait to hear from you.