Flipping houses is an investment option that has been gaining a lot of popularity lately.
Florida real estate offers good opportunities for house flippers. Florida’s growing population and availability of many unused houses that deserve a second chance make it the right candidate for the house-flipping market. Rehab and Flip, a Tampa, FL real estate investment company, provides valuable tips for flipping houses.
1. Do not overspend
Investors should consider the ARV (After Repair Value) before finalizing how much to spend on the investment property. ARV is the estimated market value of the property after repairs and renovations. Looking at the market prices of similar houses in the area will give an idea of how much the house would sell. This information should be kept in mind while planning repairs and renovations on the investment property to make it market-ready. The bottom line is that investors should not spend too much more than the ARV.
2. Do a home inspection
It is a good idea to get a home inspection done before buying the property for investment. Firstly, make sure that the property is on habitable land and in a good neighborhood. Also, ensure that the area is not prone to flooding. It is best to avoid houses that have foul odors and too many leaks to fix. Always choose a home that appeals to the buyer’s market. An ideal “2 bath – 3 bedroom” home for a small family will sell quicker than a larger bungalow. A good real estate firm can guide the investors by matching the investor’s budget with the properties available in the market.
3. Review finances
Investors should choose a house that suits their renovation budget. The best is to start small and give the property a good modern facelift to make a quick, profitable sale.
4. Trust the crew and interior designer
A good investor should hire a good crew and interior designer, as it won’t be possible to get everything done on their own. Also, ensure to act as a team and trust the experts. It is best to not unnecessarily micromanage their work.
5. Plan for cost overrun
Home renovations generally tend to run over the budget a bit. Hence, make room for these extra expenses while budgeting the repairs and renovations.
6. Keep an eye on the market
A good investor always keeps an eye on the market to find the right time to sell. It is also not a good idea to keep the investment property on hold for too long.
7. Keep emotions under check
It is common for investors to fall in love with the property after renovation and not want to sell it. However, to stay in the market, it is best to keep personal touches and feelings at bay during renovation.
Why Rehab and Flip?
Rehab and Flip are industry experts at acquiring worn-down, distressed houses and passing them to investors. They have a decade of experience in Florida real estate. The firm has properties that cater to the needs of wholesale investors as well as newbies looking to make a break in real estate.
Call Rehab and Flip today, for the best deals and unparalleled customer reach in Tampa, Florida real estate, at (813) 321-0049.
4 Common Mistakes While Flipping A House In Florida
Florida has great weather, a growing population, low unemployment rates, and a great housing market. These factors make the state an ideal candidate for wholesale real estate investors. The booming population creates high demand in the housing markets. Rehab and Flip, a Tampa real estate investment company, points out the hurdles investors face while trying to rehab and flip a house.
1. Handling money/expense
It is not advisable to pay too much money on an investment property. Every dollar spent will add to the selling price of the property. All other costs such as taxes, rehab expenses, and insurance costs should also be taken into account before fixing a deal with the vendor. Also, the right property insurance is extremely important in Florida real estate, where hurricanes are common. When it is time for the property to be sold, it should be ensured that the price is set high enough to yield the expected returns, yet low enough to attract buyers. Hence, it is all about striking the right balance. It is a good idea to get professional help to get the goals right.
2. Handling time
Flipping houses is a time-consuming task. Time has to be invested in readying the house, scheduling inspections to ensure that the property complies with building codes, scheduling open houses for prospective buyers, and commuting to and fro till the sale is done. This will be an additional burden for an investor who already has a day job that gives a steady income.
3. Skills
If the investor who wants to flip the house is good with carpentry and plumbing skills, a lot of money can be saved as many tasks can be DIY. Otherwise, skilled professionals will have to be hired to fix the house up for a sale. This will eat into the investor’s budget.
4. Experience and knowledge
Another important factor in flipping a house is to get the right leads. The art of picking the right property at the right time and right place is a skill earned generally through experience. A professional firm waits for the right time and right property before investing and does not rush in to buy a property. Also, it is important to not take emotional decisions while buying an investment property.
Why Rehab and Flip works the best for both sellers and investors?
Rehab and Flip are experts at acquiring homes at the best prices and passing them on to investors worldwide for wholesale opportunities. Their specialized team provides services in investment property deals, quick closing of deals, fast rehab, and quick flips. Rehab and Flip deals in various properties, including discount homes, distressed properties, historic properties, and bank-owned foreclosures, to name a few.
To ensure that you get the best deals and the largest customer reach, call Rehab and Flip, a real estate investor for immediate deals in Tampa, Florida real estate, at (813) 476-3199 today.
[prisna-google-website-translator] Turn-key real estate is real estate that is ready to rent and start earning a return. It includes the wholesale priced property, all repairs or full rehab, as well as management of the property.
BTGH sells investment real estate on the wholesale market to investors who plan to do their own rehabs, but increasing interest has motivated us to offer turn-key solutions to investors who either don’t have the time or patience to restore or rehab residential investments themselves.
What is Turn-key Real Estate Investing?
A real estate investor who purchases a turn-key property can expect to have everything taken care of so that they can start earning dividends immediately, similar to a paper investment, like an annuity or bond. Turn-key real estate investors are purchasing property that includes management of the property, repairs and tenancy. The revenue produced from the rental usually pays for all services, with about 5-20% left. What’s left over is essentially dividends. This residual income can be taken quarterly or annually, but it’s suggested to take profits on an annual basis, to prepare for any unforeseen problems that may arise.
Potential Pitfalls:
Every investment includes risk. Turn-key real estate is no different. Owning rental properties isn’t without problems, and each rental property will have it’s own unique set of them. The primary issue most property owners face is human related. It’s difficult to find reliable, long-term renters and it’s tough to find good, reliable help. For these reasons, we suggest that property owners take their dividends annually, to avoid having to pay out of pocket for repairs and other unpredictable problems.
The costs of hiring a property manager are usually equal to what you’d pay if you decided to do all of the work and property management yourself.
The lost revenue most independent landlords face by not having a long term tenant in place is equal to around 1.5 months rent ANNUALLY. The costs of repairs to their rental properties are usually RETAIL. Now, while you may be able to predict lost income, it’s not so easy to anticipate repairs. While turnkey investors are still liable for all repairs to their properties, our property managers will take care of the repairs for the cost of materials and our labor. Our labor costs are by the hour – not the job.
If you’re a small independent landlord, the costs you incur and the average revenue you lose will equal the cost of hiring a landlord.
Cost/Benefit Analysis
At BTGH, we have a small crew of construction personnel that perform all of our repair, restoration and rehab projects. They work full time and have a steady workload, which allows us to keep costs down. We pay per the hour, not the project and we manage every project ourselves, so we absorb that cost as well.
By keeping all costs under the same umbrella, costs stay lower, equaling a faster ROI for investors.
Turn-key Investment Real Estate from BTGH
If you’re relatively new to residential real estate investing, consider a turn-key option. If you already have some properties, consider hiring a property manager to simplify your life and your business.
For those who are looking for a turn-key investment option, our system is simple – “Buy one of our wholesale priced houses and we take care of the rest.”
How many times have you heard the question, “Is the stock market rigged?”
Please, let us answer that question for you – Yes. The stock market is rigged, but we’re not the only ones who believe it. Michael Lewis, a sports and financial journalist & author who wrote, The Blind Side and Moneyball states that “the stock market is rigged” by HFT (High Frequency Trading) traders who “front run orders” placed by investors. He details this process in his newest book, Flash Boys.
Basically, in the traditional sense of stock trading, buyers of stocks place orders to be filled by brokers. Today though, computers do everything. In theory, it should be a rather safe, error free system that is impossible to rig. The truth though is that it IS rigged. Watch the video to see how.
Not Only the Stock Market
In fact, many so-called “risk” oriented American industries are rigged to the point that there is almost no risk involved for the owners of one of these enterprises. That, of course, results in massive profits on the backs of individuals who don’t know any better.
Like a Las Vegas casino or the insurance industry, the stock exchange puts the risk on the individual investor – not the broker, the shared company or the exchange itself. There are managed odds that make winning possible, but because only “the house” really knows how everything works, losing is PROBABLE.
Insurance is Rigged
For instance, for the insurance industry, the goal is to take in more money than is paid out, yet for the actual insured party, the goal is to give them NOTHING – “0 sum”. What that means is that the insurance companies will fight to make sure that there is no winner. In the case of insurance companies fighting each other over a claim: They’d rather the lawyers end up with the money than the claimant – “0 sum”.
To take it further and ensure that they ALWAYS come out winners, insurance companies influence our politicians to pass laws that benefit their industry – like Obamacare, which REQUIRES every man, woman and child in the US to purchase health insurance..
That influence comes in the way of massive campaign contributions, cushy jobs for family members of elected officials and, sometimes, even bribes.
What sets the stock market apart from insurance and the casinos though, is that the Stock Exchange is SELF REGULATED.
Yeah, they make their own rules.
Stocks are only paper with a PERCEIVED value.
Real Value
Stocks are only paper, like money is only paper. You can’t eat paper. (Ok, you CAN eat paper, but it doesn’t have the nutritional value of, say, vegetables or meat.) What we mean by that is that paper’s value is “perceived” and is only worth what the majority of the general population deem it’s worth. Paper has no real, beneficial, body & mind empowering value. Stocks and money are little more than I.O.U.s.
Real Estate on the other hand, is a REAL asset. Heck, it’s even in the name: R – E – A – L.
Why buy paper, instead of say, HOUSES?
People buy stocks and collect coins and cars and dolls because of a “perceived” value that is perpetuated by others in the industry… and the stock market is a VERY POWERFUL INDUSTRY. “Powerful“, as in it gives lots of money to political candidates to influence how their industry is regulated… or NOT regulated.
You see, the stock market is self-regulated, meaning that it makes it’s own rules and passes down punishment to those it regulates, with no (or very little) influence from the federal government. This of course keeps the general public from understanding how the industry really works.
Ignorance is bliss, right?
Self Regulation?
Self regulation is the fox watching the hen house. Self regulation is little more than a promise to the American people to do what’s right… when they get caught by the American people doing wrong. However, if no one gets caught, then obviously no one was doing wrong. So, obviously, self regulation puts the burden on the common citizen or “whistle-blowers” to speak out against those industries that are supposed to be regulating themselves.
And for their diligence and commitment to the American people, they’ll probably be killed.
The real problem with self-regulation is that people are inherently lazy. We don’t want to do any more than what actually NEEDS to be done.
On top of these horrible revelations of political and monetary gluttony, we’re right in the middle of the 3rd biggest stock bubble in recorded history! Read this article in Market Watch to see what we’re talking about. There’s even more here.
EPILOGUE
So, the lesson in all of this is to just save yourself some stress and aggravation and buy some investment real estate already.
Written by Mike Slatton, Political & Economic Analyst for BTGH
How to Vote for Your Investment
It’s almost election time, and this year everyone hates the Democrats – except the Democrats, of course – but is it smart to vote for the Republicans?
This time around, yes, but sometimes it’s smart to vote for the Democrats, too.
Basically, if you always vote for your investments, you’ll find yourself voting for both sides of the isle, at one time or another.
Bubbles, man. Market bubbles.
So what the heck are we talking about?
Buy & Hold, or Flip
Everyone has seen or experienced a market bubble, but few people seem to understand how they’re created. Well, lucky for you, we’re going to pull back the curtain and reveal the absolute, all-time secret to successful real estate investing.
You’re going to kick yourself for not realizing it sooner.
Regardless of what you’re investing in – whether it’s stocks, real estate, gold or rare automobiles – there are peaks and valleys to every market. Knowing what causes the peaks and valleys is what helps the rich get richer.Don’t Blow It!Those who don’t understand how bubble markets work, end up:
Don’t Blow It!
Those who don’t understand how bubble markets work, end up:
…holding too long
…buying at the top
…or buying after the bubble bursts.
If you’ve done any kind of investing before, then you’ve probably done one of these 3 things. The reason why is because you were not prepared for any of it.
Long Term vs Short Term Strategies
No one wants to wait a long time to get rich, but timing is everything, and sometimes a windfall or significant injection of capital is unpredictable. Investing in tangible assets when you have money and adopting a “buy and hold” strategy is more about timing than it is strategy. There will always be bubbles in every investment cycle. The difference between a long-term or short-term investing strategy is knowing when the bubble is going to grow and burst.
As investors, we know that capital needs to be invested quickly, otherwise it will be spent. There are always improvements that need to be made and everyone wants to drive a nicer car, but if you KNEW when the market was going to take off and peak, you would probably be a little smarter with your money.
So what do bubbles have to do with voting?
How to Invest when Republicans are in Office
Democrats
Consider what Democrats stand for. The party platform asserts that government spending provides “good jobs and will help the economy today.”
This is relatively true.
If you look at statistics (and who doesn’t love statistics ), Democrats are better at creating jobs, thereby stimulating the economy in a manner that results in slow, steady growth. Basically, if everyone has a job, then everyone will spend money.
Come on, Republicans! Don’t get mad! Statistics don’t lie. Regardless, that’s NOT what we (INVESTORS) are interested in.
The reason people don’t believe statistics (relative to politics) is because the aftereffects of a president’s (or other politician’s) term may not be felt until YEARS after they’re out of office.Many Democrats are adherents to Keynesian economics, or aggregate demand, which holds that when the government funds programs, those programs pump new money into the economy.
Keynesians believe that prices tend to stay relatively stable and therefore any kind of spending, whether by consumers or the government, will grow the economy.
So, after 8 years of DEMOCRAT managed “stability”, we’re ready to shake things up. We’re tired of boring, slow economic growth. We (Americans)want it(food, money, sex, 70″ TV’s, profits)NOW!
There are times when government funding is good for investors, and there are times when it’s not. That’s why it’s important to know history.
A quick analysis of federal housing funding will show that both Democrats AND Republicans have approved measures and supported funding for AFFORDABLE housing for low and middle income Americans. These measures and funding regard mortgage rates, building, rehabilitation of neighborhoods and more. All of these things either create more inventory, or put a stress on the current inventory.
Currently, America is enjoying very low interest rates, resulting in a steady increase of general home purchases and housing starts (new homes being built).
While things are pretty good now, they’ll get even better under the Republican control. This is why:
Within the first term of a Republican takeover, Obamacare will be repealed (or replaced), and small business owners will get a little tax relief as themarginal tax rate recedes. Bank accounts will swell a little, and credit scores will rise. Consumers will then start shopping for bigger and/or newer houses. To prevent a bubble, the FED will try to correct the market and curb spending by increasing interest rates… and this is the start of the fireworks. At this point, banks will see an opportunity to make money on new lending, and they will create pressure on the general public to “purchase while interest rates are still low“.
We all know what happens next.
*BUURRRP*
You’d either have to be stupid or crazy to be a politician, and it seems we elect the former more often than the latter. Good for us, as it makes predicting their behavior much easier.
Right now, take the advice of Warren Buffett: “You can only buy when everyone else is selling if you have held your fire when everyone was buying.” You can apply this advice directly to any investment market – especially real estate.
So, if you have capital, BUY houses, condos and other rental properties now, AND HOLD. Rent them out. Make some subtle improvements to keep them rented, and just be patient.
The market is holding steady – right now.
Within 2 years after the election of a Republican President, you’ll see the bubble start forming, and it’ll take 3 or 4 years to really build.
Currently, as real estate investors, we’re in a great position. The housing market is very stable and there is just enough demand for new houses that all housing values are gradually increasing. When the Republicans take office in 2016, educated real estate investors will start licking their lips and wringing their hands as the general consumer population thinks about how they can get a bigger house with all of the extra money they’re making at work and the money they’ve saved on taxes.
SELL!
3 to 5 years (2019 – 2021) after the election of a Republican President in 2016, when EVERYONE seems to be talking about getting INTO the real estate market, that’s the point you need to sell… and that’s when educated real estate investors WILL sell. In fact, that’ll be the point when the bubble is actually recognized as a “bubble”. Interest rates will start rising IN RESPONSE to the increase in home sales.
And the beast will start feeding on itself!
Our actions of selling when everyone seems to be buying is what creates the final surge to the peak of the frenzy. Then, when OUR actions of selling stop, and the interest rates are so high that consumers and investors stop buying… the market will correct itself, and the entire housing market will do a repeat of 1973, 1979, 1989, 1996 and 2006/07. The weekend investment warriors and shade tree investors will quickly pull out and cut their losses. Foreclosures will increase again, and in 5 years we’ll be buying all over again with a NEW long term strategy in mind.
That’s also how the stock market works, and why the majority of new stock investors also lose money.
Peaks Don’t Exist
Many new real estate investors will 2nd guess themselves for selling too early and not getting the optimum value for their real estate investment. What they don’t realize is that they got out right on time, as it was their ACTIONS that contributed to the creation of the market peak. In fact, selling at the top of the market is IMPOSSIBLE, because the peak market value for real estate is really just carried upward by momentum of the buying frenzy. The value peak of any property is the value point where people begin to say “no”. Once the buyers begin saying “no”, values ALL begin sliding back down.
History of Federal Housing Legislation and Other Stuff
George Santayana, a Spanish philosopher, said “Those who cannot remember the past are condemned to repeat it.” So, if you’re bored or actually interested in learning more about all of this stuff, here’s list:
When Republicans are elected after Democrats have been in control, the first thing they do isstart slashing taxes to stimulate the economy and accelerate growth. The “trickle down” effect is supposed to result in companies hiring more employees, but only drug addicts would think that hiring more employees would miraculously result in more revenue. CEO’s and business owners who are AWAKE look at those tax cuts as additional capital. They stop buying lottery tickets and instead invest in less risky assets like real estate, stocks and collectibles.
And so it begins…
Buying and holding real estate is essentially buying and renting it out. The time to start selling is when EVERYONE is buying. The time to start buying back is when EVERYONE is selling.
In 2016, put your investments first, and vote Republican.
To see the future, we must look at the past. If you take time to look at all of our housing bubbles, they all started with government intervention, resulting in the collapse when the plug was pulled on the program.
Tax breaks for home BUYERS creates a sellers market, inflating home values. Government funding provided to builders to create more affordable housing increases the inventory of homes, thereby bringing the values of the current inventory down.
For every push, there is a pull. For every Yin, there is a Yang.
If you know who is likely to do what and WHY they are likely to do it, then you can more accurately anticipate the next market inflation, the market peak and the bubble burst.
That’s why America is going to vote for a Republican President in 2016 – and in all honesty, it doesn’t matter who the Republican candidate is. With few exceptions, every elected official is a tool of their party. That means that they will do whatever the party wants. So, what does the party want?
Tampa is in the middle of the state, part of Central Florida, sitting on the Gulf Coast. It’s metropolitan amenities, beautiful weather and proximity to tourist attractions make it a great place to live. The cost of the houses in Tampa Bay also makes it the best place to buy rental houses and other investment properties.
CNN Money, MSN Money, Forbes , Bankrate.com and AOL Money all have their own lists of best places to buy rentals, but the one state they all have in common is FLORIDA.
Last year, Graham Wood wrote an article detailing how foreign investors are buying Florida real estate SITE UNSEEN. While that trend has eased a lot, the deals that drove such care free investing have not.
Part of Central Florida, Orlando is just 90 minutes East of Tampa
ORLANDO
With rents that have barely risen at all in the last 2 years, Orlando, Fla., is still the most magical place on Earth.
Tourism continues to bolster Orlando’s business and has helped drop the unemployment rate from 11% a 4 years ago to 6.3% today, which is well above the national average. With those kinds of numbers, rentals are easy to fill, even if rents aren’t increasing much.
Florida has plenty of great real estate investment deals left, and Tampa is the hotbed of most of those deals.
On the east coast of Florida, Jacksonville is a great North Florida investment
JACKSONVILLE
Jacksonville, Fla.’s, average rent is up only 1.3% over the last year, and it’s labor and housing market was hammered by the recession. Median housing prices dropped from $174,600 in 2008 to $120,800 today and fell 2.5% in the past year alone. Unemployment has made new buyers a bit scarce as well, with the unemployment rate climbing as high as 11.2% last March before coming back down to 9.7%.
Jacksonville has a fairly stable economic base as home to the third-largest military presence in the country. A submarine base, naval air station, naval station and Marine base provide stability, while rent prices have risen in the past year to help stabilize the rental market even more.
Located almost directly between Orlando and Tampa, Lakeland is more than a suburb.
LAKELAND
RealtyTrac Vice President Daren Blomquist says Florida’s seesawing housing market — which boomed in the early 2000s, then went bust around 2007 — hit Tampa so hard that the downturn spilled over to Lakeland, a 590,000-population metro area located almost directly between Orlando (56 miles) and Tampa (51 miles).
“A lot of times, ‘exurban’ communities around a really hot area are very affected by a boom and bust,” he says. “There’s a lot of home-building in such places during the boom, but then there’s an oversupply of houses when the bust hits.”
As a result, Lakeland — best known as the Detroit Tigers’ spring-training home — saw foreclosure filings rise 95.7% during 2012.
Melbourne Beach is host to some of Florida’s best surfing
PALM BAY/MELBOURNE/TITUSVILLE
2.5 hours due east from Tampa, this metro area along the Atlantic coast is home to the Kennedy Space Center — which is fitting, because its market soared toward the moon during the housing boom, then fell back to Earth in the bust.
“You have still some leftover wreckage from the housing bubble — bad loans, a slow foreclosure process and lots of people who are ‘underwater,’” Blomquist says.
The Kennedy Space center has also cut thousands of jobs in the past couple of years or so after the space-shuttle program’s termination, adding to the 540,000-population area’s problems. “A soft underlying job market only aggravates [the Palm Bay region’s] foreclosure problems,” Blomquist says.
In 2007, Gainesville, Florida was voted the best place to live and play in the United States
GAINESVILLE
With a student body of roughly 50,000 students, and located just 2 hours from Tampa, the University of Florida provides a steady clientele for landlords big and small.
Even though the area has recovered from the housing meltdown, there are still plenty of bargains to be found. Combine that with fairly high rents, and the math for investors is pretty favorable.
The Gainesville-area market, in particular, has been attracting a lot of doctors, attorneys, accountants and other professionals looking to diversify their investment portfolios, according to real estate broker Jay Parrish. There are also parents buying places for their kids who are attending the university.
THE MEANING OF ALL THIS…
Tampa is in the middle of the best real estate markets in the state. That makes the Tampa Bay real estate market the perfect place to buy investment properties to sell or rent.
Are you a DIYer? Do you like sifting through garbage or cleaning brain matter off of the ceiling? Does the thought of removing old mattresses caked with feces get your heart racing? Then becoming a real estate wholesaler may be the perfect career choice for you.
Real Estate Wholesaler Job Summary
A real estate wholesaler basically does all of the real estate investment tasks that nobody else wants to do, knows how to do, or has time to do. Broadly speaking, real estate wholesalers look for investment opportunities, acquire them and then prepare them for the wholesale market.
Contrary to what most people may believe, RARELY does a wholesale market investor find a property that is move-in or rehab ready. When we pick up a property, it’s usually been sitting empty of a while, may be rat infested, may have been vandalized, and is usually in some state of decay.
Calculating Risk
Before we ever purchase a property, we perform an inspection to estimate the costs of:
Trashing out the property (removing all of the trash, broken appliances, broken fixtures)
Performing large scale repairs (drywall, roof, ceiling, foundation)
Replacing appliances and fixtures (toilets, sinks, lights, ceiling fans)
We also check the neighbors and the neighborhood. After all, anyone who invests in the property is going to do the same – or they should. A dangerous neighborhood or neighbors, or a house that’s too far from amenities or transportation services may result in high renter turnover. That of course affects rental income, property value and subjects the property to vandalism.
TEAM is Spelled… uh, T-E-A-M
Real estate wholesalers are TEAMS. There’s just no way that one or two people can do this and make a living. Money is made in bulk quantity. We’ve purchased hundreds of houses, multiplexes and condos, so we’ve gotten very good at estimating the costs of getting any property ready for the wholesale market. We’ve also got a pretty good network of contractors we work with. HVAC, plumbers, carpenters, drywallers, electricians, landscapers, and general laborers make up our team. No one person can manage every aspect or situation that may arise. We use professionals. You should too if, for no other reason, than to preserve you sanity.
We Buy LOTS of Houses
The only way to make money in the wholesale RE industry is buy many houses and turn them around quickly… in order to buy more houses. Our goal is that every house we purchase is ready for the wholesale market in 7 to 15 days. Many times we already have buyers BEFORE we purchase a property, so scheduling of contractors is tight. We do everything fast. Some days our office looks like a 1990’s stock market firm as we sit on the computers with a phone on each ear matching properties with investors.
So, in a nutshell, real estate wholesalers buy dilapidated properties and prepare them for the wholesale market.
Investment real estate is a term used to defiine any kind of real property that generates income or is intended to generate income – rather than being used as a primary residence. It’s very common for real estate investors to own multiple properties, generating rental income and profits through price appreciation.
Common examples of investment properties are houses, condos, and multiplexes like duplexes, quadplexes and apartment buildings. These dwellings are used by investors to generate ongoing rental income from tenants. Investment real estate is also expected to generate capital gains, as property values increase over time.
If you’re considering investing in real estate, you should be looking for properties that produce a monthly return while minimizing the amount of time and cash you need to spend tending to the property. To find the perfect opportunities, research is required. Purchasing investment real estate requires liquidating one set of assets (stocks, bonds, CDs, 401ks, etc.) and converting it into a “hard asset” – real estate.
“All real estate is extremely high risk. Development of real estate, land, Tenant-In-Common (TIC) investments, private real estate funds, fixer uppers, etc., all have much higher risk profiles than just simply buying a nice established cash flow investment property. In many of those investments, you will never see a dime of your money again because there are just so many things that can go wrong! So if you want to own real estate, consider simply taking fee simple title in your own name – or an entity you wholly own – to the properties you purchase. In addition, you must do the proper due diligence, analyze, test, review reports, etc., to make a lower risk real estate decision.”
Don’t believe everything you read.
Most of that is bunch of baloney
When the kaka hits the fan (as it seems to be happening more and more often lately), people invest in hard, tangible assets – like REAL ESTATE. Saying “real estate is risky” is like saying WALKING is risky… and walking IS risky, if you’re walking on the highway or in a national forest with a large black bear population. How about walking in the ocean? Literally walking straight into the ocean?!? That’s risky.
So, yeah, if you jump willy-nilly into a real estate purchase with no plan to how it will generate long-term revenue, you’ll just be wasting your money. Of course, that’s not “risky”. That’s just stupid. So, in the grand scheme of things, real estate is NOT risky, but you CAN make stupid mistakes.
How do investors make money in real estate?
While there are a number of factors that go into developing a successful and profitable real estate investment plan, the fundamentals of real estate investing can be summarized very easily:
1. Cash Flow
Investment Real Estate cash flow.
Real estate property produces income from the rent its tenants pay. Whether it’s a condo, an apartment building, or a shopping mall, investment property generates income by leasing its space. Property owners may also incur expenses to manage the property, such as electricity, insurance, janitorial, POA fees, or property taxes, which reduce the return on investment.
Yeah… so, cash flow. Makes sense, right?
2. Appreciation
People need 4 things to survive in today’s world: Food, shelter, health and education. Good health, a steady supply of food and the ability to focus on educating one’s self all depend on having adequate shelter.
(*** It’s easy to see where we’re going with this.)
Real estate has intrinsic value; People must live, work, and shop somewhere, and there is a limited supply of property. Of course, those limitations are based on population density, jobs, climate, and other factors. If a population is steadily increasing in an area, then – with all other variables remaining the same – the value of real estate is guaranteed to increase as well.
As property values increase, there is a justification in charging more rent.
Now, common sense must prevail here. If you own an old house in an area of new construction, it may be difficult to find renters for the same prices of comparably sized dwellings. If you own older investment real estate, you may need to keep your rents a little lower. In addition, you should always be a little nicer than the local property management company.
The real secret to successful real estate investing is RELATIONSHIPS.
Development
Sitting on Money
Development is the business of improving real estate through the process of building, renovating, or improving through adding square footage.
Development is probably the quickest way to get the biggest return your investment real estate, and it’s a great “elbow grease” investment, since you can see a return through sheer effort.
Overall, land with a finished building on it is worth more than just the land itself, and a rehabbed building is worth more than a dilapidated one. Get some rent paying tenants in those dwellings and you’re sitting on money.
Where do you find Investment Real Estate?
The biggest challenge in investment real estate is actually FINDING investment real estate. Obviously, purchasing real estate at retail value is not the smartest idea, and some properties are better investments than others. Some properties like vacation homes, houses in bad areas, and college rentals require way too much time and management to make them good investments.
Examples of good investments are nice boring properties that stay rented for long periods of time to clean, credit worthy tenants. They take the least time to manage and, if you them fairly and with respect, you’ll find that those tenants will take even better care of your property.
Good relations with tenants will reduce hassles when problems arise – and problems WILL arise.
Nice, boring, wholly owned, well maintained, cash flow-positive properties make the best investments. They’re out there, but you aren’t going to find them on Realtor.com for a decent price. You need to do some hard work, research, read up, and make smart, educated decisions to acquire the best real estate investments! Or find a real estate wholesaler.
The Real Estate Wholesaler
Investors were scooping Florida investment real estate like candy from a busted piñata
Over the last half-dozen years, investors have been scooping up cheap, distressed properties like candy from a busted piñata. Now, though, competition has increased a lot in the investment real estate market, and those same investors have started writing books, as things aren’t quite as easy as the once were. That’s good for the rest of us who are eager to get started.
Wholesalers are still investors, but they focus on quick returns on their investments. Quick returns are rarely LARGE returns. Wholesale real estate investors focus their efforts on foreclosure auctions, tax liens, estate sales & liquidations, inherited properties and distressed owners.
Once purchased, the wholesaler’s goal is to sell the property in 7 to 15 days. They have a contact list of fellow investors that they work with and who get first option on the properties, but this isn’t an exclusive group of investors.
Almost anyone can get access to the list of available properties a wholesaler has, but you need to know what you’re looking for so that you can find it. The key is to buy where the prices are still low, in cities with a lot of growth potential. In other words: Anywhere in Florida.
Best Places to Buy Investment Real Estate
20 Best Markets for Buying Single Family Homes
If you’re interested in purchasing investment real estate, there are a few things to consider. The first of course is LOCATION. Location plays a vital factor in who you’ll be renting to. This also determines how much your first investment property is likely to cost and how much revenue it’s likely to create.
If you’re a Florida real estate investor or are interested in Florida investment real estate, then you’re pretty smart. Of the top 20 best markets to buy investment real estate, 8 are on Florida and located in and around Central Florida, including Tampa, Lakeland and Orlando.
This list was developed by RealtyTrak and based on sales price, mortgage payments, cash flow, returns, and purchase prices. These are areas known to have a good population density, decent job market, and above average growth coupled with lower than average home prices.
“We are at a stage in the economic cycle where job growth–and demand for housing–is accelerating in some markets,” says Ingo Winzer, founder of Local Market Monitor. “The types of jobs created are often lower-paying, most suitable for renters, younger people who are willing to move from somewhere else and who don’t want to own a house right now but might have a young family and would like to rent one.”
Bay To Gulf Holdings is wholesaler of investment real estate. If you’re interested in purchasing houses, multi-plexes or condos to rent or flip, take a look out our ever changing List of available Florida Wholesale INVESTMENT PROPERTIES.
