Investment real estate has been something I have done since 1985 and I have done over 1000+ deals. It has made me a great living and complete freedom on my time. The blog title comes from an article from https://www.forbes.com/. I wanted to discuss some ins and outs on buying a home for income.
"When you start looking at investment properties, you'll likely have plenty of options to choose from. Rather than being a complicated equation, the one-percent rule is simply a rule of thumb that investors use to help them narrow down their options quickly and efficiently. It's a tool that you can use to determine if a property deserves a closer look."
We just rented a home that we had less than a $100,000 in for $1350 a month. Our homes that we purchase for clients better than the 1% formula and also creates equity for our clients. That includes the purchase and rehab cost of the home. These homes are in quality areas that attract quality tenants.
To get the better returns we almost always focus on getting homes that need a bit of updating. Not a lot just a need to get a face lift. Colors and flooring are usually the biggest issues in homes needing a face lift.
That does two things less money for rehab and get the property occupied faster.
" Once you've narrowed down your options to a handful of potential properties, it's time to look at the capitalization rate, or "cap rate" for short. This helps you calculate property's potential for return on investment."
This is where the rubber meets the road when you are investing in any property. How much is a home actually going to make you, or better stated potentially going to make you? Is that home going to attract a lot of quality tenants?
I often see investors just go for the cheap and off market homes. Usually those are the best looking properties on paper. Meaning that the numbers really look really good when they are selling the property. The issue is after you purchase a property does that home produce money for you? I know of many homes that simply cost the investor money to keep them..........
When I look at real estate for my clients I always want to help verify the numbers and will that property produce a good income and have a great shot of getting a nice equity growth in the future. In 2018 our clients are getting $348,000 a year rent receipts.
We met all but one homes projections and create a nice income for our clients income and the one was off $50 a month. We purchased these properties $100,000's of dollars off the original list prices and they where kept on budget and on time for leasing them.
We handled all the purchases, rehab and leasing them out for our clients and got the top rents to boot! Check out the video below if you do not believe me.
Need income real estate call me let's have coffee call me 216-703-5740 EXP Realty Ohio and our team in Arizona 602-363-6551 EXP Realty Arizona.
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Thank you