According to the Kansas City Star, residents in the city’s metropolitan area are increasingly choosing to rent, rather than own homes.

Rents have risen and construction of new rental units is up, the news source reports, to meet the desires of a population who are largely renters by choice. One renter noted it made no sense to buy since he was uncertain how many years he would stay in the city.

One area brokerage manager stated that the long-term commitment a mortgage may require is a major factor, also citing efforts by rental managers and owners to offer higher-quality properties with more amenities, better appliances and furnishings, or other perks.

Another expert told the source that the current single-family housing market has caused people to rethink homeownership, and many have decided they do not want to pursue it. While he said the housing market will likely recover in time, this attitude shift may be an opportunity for investors willing to rent a home to give residents the best of both worlds, allowing them to live in a single-family property without being tied to it long-term.

Federal plans to market 200,000 foreclosed homes as rentals are drawing major interest among investors including private equity firms, Bloomberg reports.

More than one firm plans to invest $1 billion or more in the opportunity from now to 2016, according to the news source, as they vie for the chance to be involved in a move that is expected to exercise a significant positive impact on the national housing market.

GTIS Partners indicated it expects to invest largely in the hardest-hit states, such as California, Nevada and Arizona. Investors and property management companies in harder-hit states should expect the largest changes, while those in areas with fewer foreclosures will likely experience less of a difference as these new rental homes become available.

Proponents of this move believe it will stem the tide of dropping home prices and reduce lender losses on foreclosed and distressed properties. Proposals for how to go about converting REO properties to rentals have been under discussion since September, and now officials and investors are preparing to move forward.

According to GlobeSt.com, demand for rental housing in Phoenix is expected to level off this year after a moderate increase during 2011, though investment activity is expected to remain strong.

Such an increase in demand would represent a continuation of the trend that marked 2011, in which demand was high enough for rents to increase sharply. Net effective rents rose 12 percent overall since 2009, one expert told the source.

The demand for rental housing is high enough that construction of several new apartment units are planned, indicating there is likely an opportunity for investors to purchase profitable rentals in the area. Rental property services are available for those who wish to own a property without operating it.

According to the source, Phoenix has been the target of significant investment recently because of the market conditions. One aspect of the market that has improved recently is the number of real estate-owned properties in the metro area, which decreased in 2011.

Some investors are reportedly pursuing value-add deals in the area to better appeal to prospective tenants. Colliers International executive Brad Cooke told the source this year would see a shift from REOs to traditional sellers.

Landlords have been able to buy properties in the metro area for far less than in the past, according to the source. Demand has been high, and Florida has been hit hard by foreclosures, leading to problems in the for-sale homes market.

One apartment data firm reported that average rents for the Orlando metro area reached $833 in October, compared to $822 six years before. Occupancy rates for rental properties have reportedly increased from 87 percent to 92 percent in the past two years, the paper states.

“This is one of the most profitable times for landlords,” a local industry stakeholder told the Sentinel. “Prices will stabilize and there will be a huge increase in foreclosures but, at the end of the day, if I can buy a property and can get it for a very good price, I can rent lower and still make a profit on my investment.”

Property owners and rental managers in the area are no longer offering incentives as much as they did in previous years, since demand has made them unnecessary.

A credit score is one of the main factors in determining loan terms, if not the primary factor. What a given credit score will qualify an investor for may vary somewhat between lenders, but the importance of credit does not.

One expert told Bankrate.com that having a credit score lower than 740 tends to mean the same interest rate will cost more. This will likely mean paying points in order to keep the rate steady, or accepting a higher rate in order to close the deal.

When checking one’s credit, it is a good idea to look at the history and not just the score. If a credit report has mistakes on it, or lacks information that shows a borrower in a good light, having that data corrected or added may improve the individual’s ability to qualify.

Credit expert Gerri Detweiler wrote that it is also important to avoid taking major actions based on a credit report without consulting someone knowledgeable. While paying off certain debts may seem wise, the circumstances may cause it to appear questionable to lenders. If an individual cannot qualify for acceptable loan terms, then it may be best to wait and strengthen one’s position or find a partner. This may require the reconsideration of decisions such as whether to use a property manager, however.

Located in the right spot, a rental property can be quite a profitable venture. Most landlords need some help getting a rental business off the ground, however, and will want to evaluate their financing options.

A sizable down payment is generally necessary, with 20 percent being the norm. Having as much as 25 percent, however, may lead to better loan terms and qualify a buyer for a much more favorable interest rate.

If that is not possible for some reason, or other circumstances make the process difficult, Bankrate.com suggests going to a smaller neighborhood bank for financing. This can sometimes be advantageous, since such institutions often have more flexibility and a better understanding of the local market and conditions.

Beyond their knowledge, neighborhood banks may have more interest in investing in a particular area. Experts also recommend investors do some investigating for purposes of due diligence before deciding on a particular lender.

When thinking about buying an investment property, the prospective landlord should first consider whether he or she intends to manage it personally or retain professional rental property services. The two levels are involvement are significantly different and may affect other decisions.

According to an article in this October’s Housing Wire Magazine, “Foreign executives temporarily working in the United States…may also purchase homes.” These houses are often subsequently leased to colleagues and employees. Another common scenario for foreign investment involves parents purchasing a house with the intent to rent it out until the family’s child is ready for college, at which time he or she will reside in the property.

No matter what the specific circumstances surrounding their specific investments, foreign investors spell good news for property managers looking to expand their business, as these investors, who often spend relatively little time in the U.S. themselves, are anticipated to drive up the demand for local property management services in the coming months and years.

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The school of thought for many investors was that a home is purchased that needs some TLC, or extremely low, then turn right around and sell it. In today’s market with pricing being so low, many investors are seeing deals that they just cannot pass up. The problem is that flipping and reselling right away are no longer an option. However, what is an option is sitting on the property, and allow the market to work its magic.

Making That Purchase Work

Holding onto a purchase is a great way to develop an overall net worth, have a series of income properties, and then begin to wait until the market begins its climb back. This is how many investors made their millions during times of economic strain. There are a couple of schools of thought on this type of strategy.

The first is that the rental market is at nearly full occupancy rates. This means that a home will not sit vacant for much time.?The sad reality is that people are losing their homes, so renting is their only option.

As far as investing is concerned, there is also a new trend where buyers can purchase the home that a family lives in, then allow the family to remain in the home as a rental. When the market comes back to life, the family can then have the option to re-purchase the home. This is another idea that has allowed people to stay in their homes, while allowing investors to capitalize on the slow market.

Good Timing for All

There is negativity surrounding the housing market today, and for good reason; it is slow, unproductive, and has a diminishing return. The idea of holding on to a purchase suggests that the high-risk reward factor is tamed. Taking advantage of, and maintaining, properties is something that will reward in years to come.

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When you think about buying real estate for investment, you don’t have to just consider houses. There are plenty of commercial properties available, and they all have something to offer. You can purchase them and resell them, or you can rent them out to businesses that need space but that can’t afford to buy it because of a down economy. No matter what you decide to do with the property once you have it, the time to buy it is now. While there has been talk of another dip in housing prices, that doesn’t apply to commercial properties, which are unlikely to be priced any lower than they are right now.

There are a lot of properties to choose from, so there are bound to be several that meet your needs. Take the time to examine them carefully. You don’t want to get stuck with a piece of property that you can’t do anything with. That would mean that you lost a lot of money, and you might not be able to get it back very easily. Don’t let that happen to you. It’s much better if you can get only properties that are still very valuable but can be bought cheaply through foreclosure or other means.

Don’t just start buying up properties, though. You’ll need to know what you’re doing so you can get the best deals. Find a good agent to work with, and ask a lot of questions. Think about what you really want to do with the properties and consider the value that you’re getting for the money. That way you’ll be able to make sound choices that will pay you back exponentially in the future. It’s the best way (and the best time) to buy commercial property.

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If you’re trying to buy a home, you have a budget in mind. Most people end up buying at the top end of their budget or even a little bit outside of it, but you don’t have to be one of those people. You can find something that’s inexpensive and really great. When you decide to look at houses, do you set both a top and bottom figure? A range that you want to look in? That’s generally what people do, and it can stop them from seeing some great homes that are actually priced lower than the homes they’ve asked to look at. Don’t assume you can’t find something that costs less and that fits your needs.

Because of the foreclosures and other problems with the housing market, it’s important you remain open to different options. Something that was valued at one hundred thousand dollars two years ago might have a value of sixty thousand dollars today. Your money will go further in this housing market, and you have more buying power. There are two ways to use that. You can buy at the very top of your price range, knowing you’re getting a home that will eventually be worth much more than what you paid, or you can buy at the low end of your price range (or even below it) and get a house that you have to pay substantially less for.

By doing that, you have a lower house payment that you won’t have to struggle to make in a volatile job market, and you also have a chance to free up money to do work on the house. It may take a little bit of time, but you can turn it into just what you want – and all because you didn’t focus on the fact that it seemed to be priced too low for what you wanted.