CHARLESTON, SC (WCSC) - The housing market is still making a recovery, but investors are seizing an opportunity. Rather than investing in stocks, many are buying homes and becoming landlords.
"We spent hours cleaning the baseboards. We painted every single room. The kitchen was an absolute mess. Everything was just sticky," home buyer Ashley Dean said.
Ashley Dean put a lot of work into a house she bought in Summerville, prepping it for a potential renter to move in. She already owns one home and recently bought a bank-owned property for what she describes as a steal.
"I needed to make some sort of investment. For me it was either the stock market or real estate. I liked what real estate had to offer. With the stock market crashing in 2008, it just made me nervous," Dean said.
According to Charleston Trident Association of Realtors, it's not just small time investors like Dean buying homes to rent out, professional investors are also getting good deals on bank owned or foreclosed properties.
"It's been an incredible buyer's market for them. Being able to get a price low enough to where it cash flows, meaning they can make money off the rent," Rob Woodul, Past President of CTAR, said.
Woodul says many investors believe they can build wealth through real estate because people always need a place to live, it diversifies their money, they get a tax break, and homes often appreciate in value.
In the future, Dean hopes to become the landlord for just the right renter to help her cash in.
"I'm hoping for a good investment, one that is sound and secure. At the end of the day, over time hopefully I can pay it off and it will be profitable," Dean said.
Some advice from real estate experts before buying a place to rent out: Do your research on the area, determine whether it will be profitable, and know what it takes to be a landlord, which includes getting overnight calls to do repairs at the home and managing your property.
According to CTAR the most active area for home sales in the tri-county are: Daniel Island, with homes sales up 65% over last year, North Charleston, with sales up 33% over last year, and West Ashley, with sales up 3% over last year.