In our last post, we discussed the pros and cons of renting or selling your fixed-up property. So much of this decision depends entirely on the homeowner. Your lifestyle and your vision of what you want to do with this money will greatly impact your decision of how to invest in your real estate property. While many questions require some deep thinking from you, you are also required to analyze the current market in order to determine your best move.
Know Your Community
In addition to knowing what type of investor you are, you need to know the community where you will be working in order to make a qualified decision whether to rent or sell. How hot is the housing market? Is it a community of buyers or renters? Will your potential buyers on a fix and flip be able to finance a home at the price where you need to sell?
Many people still are unable to qualify for a mortgage because of the tightened market even though the economy is getting better. More families still are coming off foreclosures and are trapped in rental situations out of necessity. Plus, some couples are interest in escaping the responsibility of home ownership, thus willing to pay extra to leave the maintenance in someone else’s hands. In a college town, for example, rents are through the roof and allow you to make a handy profit while paying off the loan on an investment property.
Spend time in the community. Talk to folks in the coffee shop, go out to dinner with local business leaders, read the local paper, and stay up to date on property sales in the neighborhood. How does the neighborhood you’re looking to buy in stack up with others near it? Is the median income in your area higher or lower than neighboring communities? What is the unemployment rate? This is key information that will influence the success of your investment property.
How does the neighborhood compare to others nearby? How does the median income compare to neighboring communities? What is the unemployment rate? Also important to consider are real estate taxes. This is key information that many investment property buyers unfortunately fail to obtain before buying.
That house is still sitting there – a great opportunity to snatch it up and make some profit. Now, it’s up to you to decide what strategy you want to employ to make that happen.
Contact Center Street Lending when you are ready to make the move. We have the tools to guide you into our fix/flip program for a short-term loan or into our rental program to get you into a longer-term loan at competitive rates.