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Beginning Investor FAQ #4

By
Real Estate Agent with Chicagoland2to4Flats.info

4.  What are common investment options to consider: general cautions?

  • One option to be careful about is buying a condo preconstruction with the hope of flipping them. While some have made money, there are others who have lost—and some of them BIG.
  • Renting out single-family homes can also be dangerous (as tenants can do a lot of damage).
  •  What about Non-Owner-Occupied 2-Flats? It’s true that they require less of a down payment, but rarely does a 2-flat bring in enough rent to cash flow (and so few find this a viable option).

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Comments (1)

Joanne Louise Stevens
Keller Williams Realty Los Angeles-Brentwood - Los Angeles, CA
Realtor - Serving Brentwood and Surrounding Cities
Good morning Bill: Thank you for your post. I agree that buying a pre construction property to flip is risky in this market. In some areas, the builder is having a difficult time trying to sell off available inventory. Buy to hold may be the better option. Hire a real estate professional to research comparable rents. The investor should contact a few property management companies in the area where the property is located and inquire about the vacancy rate. There is always a possibility of a tenant damaging a property. It's apart of the business. As an investor, do not have an emotional attachment to your rental properties. I not saying, don't be concern, but understand that you can not predict human behavior. Good luck in working with your investors. Thank you for posting. This was a great post! Have a prosperous week.
Aug 02, 2011 05:29 AM