EXCEEDING YOUR EXPECTATION
SUCCESSFULLY EXECUTING A PROPERTY FLIP
What are the elements of successfully executing a property flip? A flip is a technique that Real Estate Investors use to earn significant profits. The goal is to achieve the profit margin in a relative short time period (within no more than 3 months). This is usually done in one of two ways. One way is for the investor to purchase a property at a lower price and then quickly sell it at a higher price. This is done in an accelerating market. The other way is for the investor to purchase a property that is in need of repairs, renovations and upgrades. After the improvements are completed, this property is now on par with the surrounding properties in that market. The subject property can then be sold are a higher price.
There are many factors that come in to play to ensure a successful and profitable flip occur. Due diligence must be correctly done. To be a Real Estate Investor is to be a Real Estate Investigator and Project Manager. The Real Estate Market and subject property will have to be correctly assessed and evaluated. The subject property will have to be identified and located. Funds will have to be appropriated for the purchase of the subject property (cash buy or loan). Purchase negotiations will have to occur and you don't want to over pay for the property. In Real Estate Investing, you make your profits on the buying side and cash out on the selling side. If improvements will be installed in property, the reno cost will have to be correctly computed and negotiated. Reno cost and lead time will greatly affect profit margin. The contractors should be licensed, insured and bonded. Once improvements are completed, a robust sales and marketing campaign must be engaged and must conclude with the investing achieving the computed profit.
As you can see, there is much to factor in to successfully executing a "simple flip". Hoperster REI will take care of every step of the process.
CASH FLOW OF RENTAL PROPERTY
What are the elements of successfully executing a cash flow of a rental property? Cash flow rental is another technique available to Real Estate Investors. The goal is to obtain a property and use it as a cash producing rental. This property will produce consistent, predictable, repeatable and reliable profits by renting units out. The number of units will vary as will the terms of the rental agreements. A good strategy is to have several units and diversify the rental terms. Some of the rental units could rent out daily or weekly, other units could rent out monthly and the remaining units could rent out yearly or longer. Airbnb is a good source to advertise for daily, weekly and monthly renters.
It is paramount that due diligence is correctly performed to ensure successful results. The Real Estate rental market will have to be assessed and evaluated, which is different from the flip market. The Capitalization (CAP) rate is a feature that is often used to evaluate the profitability of cash flow producing rental properties. Other factors an investor must understand are demographics, the interest & bond rates, the job market & economical growth, area desirability (qualify of life) and many others.
An additional cash flow producing rental property investment option is a Bed & Breakfast. Much of the techniques and the due diligence are the same as with multiple dwelling units. One approach that many investors employ is to create a custom B&B from the ground up.
In addition to these, there are many other Real Estate Investment options to explore. Every Investor's goal and situation is different, so there is not a "one size fits all" approach. This is why Hopester REI will personally meets with you and tailor a plan for your goals.