Real Estate Investors * Many UNsold Area Listings are Going to BECOME Investment Property
Many UNsold home listings are going onto the rental market in our area as owners move for better jobs or higher education. They will rent where they are moving and keep their local property as an INVESTMENT and continue to have the same and MORE tax advantages.
With more Americans renting, the investment property market is booming, and with good reason. There’s money to be made in many types of investments, and a self-sustaining property that pays its own mortgage, builds equity while you sleep, and maybe sends a little profit your way sounds too good to pass up.
Whether you’re looking at multi-unit dwellings, long-term home rentals, new construction, or improving and reselling, there’s a big potential upside, and timing has never been better. But here are a few cautions to keep in mind as you embark upon your journey.
1. Know Your Strengths.
Are you a do-it-yourselfer with experience fixing and maintaining homes? Do you live near the investment property you’re looking to buy? Do you mind phone calls in the middle of the night? Be honest about your motivations and capabilities. If you’re new to the game, fixing and flipping foreclosures may not be right for you. If you travel a lot, or just don’t want to be bothered, using a management company may be well worth the money, and then some. If you find yourself with era time and money down the line, you can always purchase a second property.
2. Don’t Over-leverage.
Real estate is a fairly safe long-term investment, but short-term fluctuations can hurt. You don’t want to be forced to pull money from a property at the wrong time, so only invest what you can afford to leave in play for several years, and don’t skimp on the down payment. Investment properties don’t qualify for mortgage insurance, so you’ll need to put down at least 20 percent. That’s a good thing. Buying within your means will reduce your monthly costs, and put less of a stress on your budget when the unexpected pops up (see below).
3. Never Expect 100 Percent.
A 10-unit complex at $1000 per unit can generate up to $1.2 million per year, but even in this market, you’ll be lucky to see 80% of that. Month-to-month leases and evictions produce uncertain cash flows, rental incentives can shave a month or two off your income, and transitions mean down-times for repairs and cleaning between tenants. Expect less than you think you’ll make and you’ll probably be pleasantly surprised.
4. Ask for Help.
You’re not in this alone. There are thousands of people just like you, and ll you have to do is reach out. There are plenty of real estate investor groups online, and you should join them, but you should start your search locally. The neighborhood hardware store is a good place to start. Ask around for contractors and handymen. You’ll need them later, and they can point you toward other investors in your area with whom you can swap information, and maybe partner on a deal some day.
Chris Thomas
Realty Executives SE LA
1795 W. Causeway Approach Suite 201
Mandeville La, 70471 USA
Licensed Agent in Louisiana
Website- www.ChrisThomasHouses.com
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