Interest Rates: Investment Properties & Second Homes
Right now, the interest rates for an investment property and a vacation home with 20% down are the same. This is very unusual.
In most cases, you're going to get a better interest rate for that vacation home, but in today's market pricing, the interest rate is the same.
The benefit of going with a investment property is that you may actually be able to qualify for more, based on the rental income and/or the rental potential of the property you want to purchase.
So, you can put the same amount down, get the same interest rate but borrow more, and be able to buy more property. This comes into play, especially in a resort market where it’s possible that a higher-priced property will give you a greater return on the rental investment. By being able to factor in that rental potential, you now may be able to qualify for that property.
Thus, next time you're considering making a purchase and you hav to choose between an investment property versus a second home, you might want to consider that investment home opportunity. In today's market pricing when it comes to interest rates, this will allow you to borrow more and buy more property.