Ultimate Cobb County Real Estate Investing Guide for 2024

The abbreviation BRRRR is a description of a long-term rental plan — Buy, Rehab, Rent, Refinance, Repeat. When you want to increase your investments, the BRRRR is a good method to follow. This method hinges on your capability to remove money out when you refinance.

You add to the worth of the investment asset above what you spent buying and fixing it. Then you withdraw the value you produced out of the investment property in a “cash-out” mortgage refinance. You purchase your next asset with the cash-out funds and do it anew. You add growing assets to the balance sheet and lease revenue to your cash flow.

When your investment real estate collection is substantial enough, you can delegate its management and receive passive cash flow. Locate Cobb County property management companies when you search through our directory of professionals.

Factors to Consider

Population Growth

Population increase or shrinking tells you if you can expect reliable results from long-term real estate investments. An increasing population normally indicates vibrant relocation which translates to new tenants. Employers see this as promising place to relocate their company, and for employees to situate their families. A rising population builds a stable foundation of renters who can survive rent bumps, and an active seller’s market if you need to sell any properties.

Property Taxes

Property taxes, ongoing upkeep expenditures, and insurance directly hurt your bottom line. Steep real estate tax rates will decrease a real estate investor’s income. Areas with unreasonable property taxes are not a stable setting for short- or long-term investment and should be bypassed.

Price to Rent Ratio

The price to rent ratio (p/r) is a comparison of median property values and median lease rates that will signal how high of a rent the market can allow. An investor can not pay a steep sum for an investment asset if they can only collect a limited rent not enabling them to pay the investment off in a suitable time. A high price-to-rent ratio signals you that you can collect lower rent in that community, a small p/r says that you can charge more.

Median Gross Rents

Median gross rents are a clear sign of the vitality of a lease market. You are trying to discover a market with repeating median rent expansion. If rents are declining, you can scratch that area from discussion.

Median Population Age

The median residents’ age that you are on the lookout for in a dynamic investment market will be similar to the age of salaried people. This may also signal that people are migrating into the region. If you see a high median age, your supply of renters is reducing. That is a weak long-term financial scenario.

Employment Base Diversity

A diverse employment base is what a smart long-term rental property owner will hunt for. When there are only one or two major employers, and either of such moves or closes down, it can make you lose tenants and your real estate market rates to decrease.

Unemployment Rate

You will not be able to reap the benefits of a secure rental cash flow in an area with high unemployment. People who don’t have a job can’t buy products or services. This can cause more dismissals or fewer work hours in the region. This may increase the instances of delayed rents and renter defaults.

Income Rates

Median household and per capita income levels help you to see if a high amount of ideal renters live in that location. Your investment budget will consider rent and property appreciation, which will depend on salary augmentation in the city.

Number of New Jobs Created

An increasing job market produces a regular pool of renters. An economy that adds jobs also adds more participants in the property market. Your objective of renting and purchasing more properties requires an economy that will provide more jobs.

School Ratings

The status of school districts has a powerful effect on housing market worth throughout the community. Well-graded schools are a necessity for employers that are looking to relocate. Dependable renters are a consequence of a vibrant job market. Homebuyers who move to the community have a beneficial impact on housing prices. Good schools are a necessary factor for a reliable property investment market.

Property Appreciation Rates

Property appreciation rates are an essential component of your long-term investment plan. You have to have confidence that your property assets will grow in price until you want to liquidate them. Low or declining property appreciation rates should remove a location from being considered.

A short-term rental is a furnished residence where a tenant resides for shorter than four weeks. Short-term rental owners charge more rent a night than in long-term rental properties. Short-term rental homes could demand more continual care and cleaning.

House sellers waiting to move into a new home, excursionists, and individuals on a business trip who are staying in the city for a few days prefer to rent a residential unit short term. House sharing sites such as AirBnB and VRBO have opened doors to many homeowners to engage in the short-term rental industry. A convenient technique to enter real estate investing is to rent a property you currently own for short terms.

The short-term rental business includes interaction with occupants more frequently compared to annual lease properties. That leads to the landlord being required to regularly deal with complaints. Give some thought to controlling your liability with the aid of one of the top real estate lawyers in Cobb County GA.

Factors to Consider

Short-Term Rental Income

You should imagine the level of rental revenue you’re searching for based on your investment calculations. Being aware of the standard amount of rental fees in the region for short-term rentals will enable you to pick a desirable location to invest.

Median Property Prices

You also need to determine the amount you can bear to invest. The median values of real estate will show you if you can manage to be in that community. You can also use median prices in specific areas within the market to pick locations for investment.

Price Per Square Foot

Price per square foot can be affected even by the design and layout of residential properties. If you are examining similar types of real estate, like condominiums or stand-alone single-family residences, the price per square foot is more reliable. You can use the price per sq ft metric to get a good general view of real estate values.

Short-Term Rental Occupancy Rate

The number of short-term rental properties that are presently occupied in an area is critical knowledge for an investor. A community that necessitates additional rental properties will have a high occupancy level. Weak occupancy rates signify that there are more than enough short-term rentals in that market.

Short-Term Rental Cash-on-Cash Return

Cash-on-cash return is a means to calculate the profitability of an investment plan. Take your projected Net Operating Income (NOI) and divide it by the cash amount you’re ready to invest. The answer will be a percentage. High cash-on-cash return demonstrates that you will recoup your funds more quickly and the purchase will have a higher return. If you get financing for a portion of the investment and use less of your own funds, you will get a higher cash-on-cash return.

Average Short-Term Rental Capitalization (Cap) Rates

This criterion compares rental property value to its per-annum income. High cap rates show that rental units are available in that area for decent prices. If cap rates are low, you can assume to spend more cash for investment properties in that market. You can get the cap rate for possible investment property by dividing the Net Operating Income (NOI) by the market worth or listing price of the residential property. The answer is the annual return in a percentage.

Local Attractions

Short-term rental units are preferred in places where sightseers are drawn by events and entertainment spots. If a location has places that periodically hold must-see events, such as sports arenas, universities or colleges, entertainment venues, and amusement parks, it can invite visitors from other areas on a regular basis. Must-see vacation spots are situated in mountainous and beach points, along rivers, and national or state nature reserves.

When an investor buys a property cheaper than its market worth, rehabs it so that it becomes more attractive and pricier, and then sells the property for a profit, they are known as a fix and flip investor. The keys to a lucrative investment are to pay less for the investment property than its current value and to carefully calculate the amount you need to spend to make it sellable.

It’s crucial for you to be aware of how much homes are being sold for in the market. You always have to research the amount of time it takes for homes to sell, which is shown by the Days on Market (DOM) information. Selling the house fast will keep your costs low and ensure your revenue.

Help compelled property owners in finding your company by listing it in our catalogue of the best Cobb County home cash buyers and Cobb County property investors.

Additionally, look for property bird dogs in Cobb County GA. Professionals discovered on our website will assist you by rapidly finding conceivably successful projects prior to the opportunities being listed.

Factors to Consider

Median Home Price

When you hunt for a good region for house flipping, look at the median housing price in the neighborhood. You are hunting for median prices that are low enough to reveal investment possibilities in the area. This is a vital component of a cost-effective investment.

When you see a rapid drop in real estate market values, this may indicate that there are potentially houses in the market that qualify for a short sale. You will hear about potential investments when you team up with Cobb County short sale processing companies. Find out how this happens by studying our article ⁠— How Can I Buy a Short Sale House?.

Property Appreciation Rate

Are home prices in the city moving up, or on the way down? You have to have a community where property prices are constantly and consistently ascending. Volatile price changes aren’t good, even if it’s a substantial and sudden surge. Purchasing at a bad point in an unstable market condition can be disastrous.

Average Renovation Costs

A comprehensive review of the market’s building expenses will make a huge impact on your market selection. The manner in which the municipality processes your application will affect your venture too. You need to understand if you will need to use other experts, such as architects or engineers, so you can get ready for those expenses.

Population Growth

Population information will inform you if there is an expanding necessity for residential properties that you can provide. Flat or declining population growth is an indicator of a weak market with not a lot of buyers to justify your risk.

Median Population Age

The median citizens’ age is a clear sign of the supply of possible homebuyers. It shouldn’t be lower or higher than the age of the regular worker. These are the people who are qualified homebuyers. People who are planning to exit the workforce or are retired have very particular residency needs.

Unemployment Rate

When checking a city for real estate investment, look for low unemployment rates. It should always be lower than the national average. If the region’s unemployment rate is less than the state average, that’s an indicator of a preferable financial market. In order to acquire your improved homes, your potential buyers are required to be employed, and their clients too.

Income Rates

Median household and per capita income amounts tell you whether you will see qualified purchasers in that region for your homes. Most individuals who acquire a home have to have a home mortgage loan. Home purchasers’ eligibility to borrow a loan depends on the size of their wages. The median income data will show you if the region is beneficial for your investment efforts. You also prefer to have wages that are improving continually. When you want to augment the purchase price of your residential properties, you want to be positive that your home purchasers’ salaries are also improving.

Number of New Jobs Created

Knowing how many jobs appear per year in the region can add to your assurance in a city’s real estate market. An increasing job market communicates that a higher number of people are receptive to buying a house there. With a higher number of jobs created, new potential home purchasers also move to the region from other locations.

Hard Money Loan Rates

Short-term real estate investors often borrow hard money loans rather than traditional loans. This strategy enables them complete profitable projects without hindrance. Locate the best private money lenders in Cobb County GA so you may match their fees.

People who are not well-versed in regard to hard money loans can discover what they should know with our guide for newbies — What Does Hard Money Mean?.

In real estate wholesaling, you search for a property that real estate investors may count as a profitable opportunity and sign a contract to buy the property. However you do not purchase the home: after you have the property under contract, you allow an investor to take your place for a fee. The real estate investor then settles the purchase. The real estate wholesaler does not sell the residential property itself — they just sell the rights to buy it.

This strategy involves utilizing a title firm that’s familiar with the wholesale contract assignment procedure and is capable and willing to coordinate double close purchases. Search for title companies for wholesaling in Cobb County GA in our directory.

Discover more about the way to wholesale property from our comprehensive guide — Wholesale Real Estate Investing 101 for Beginners. When you select wholesaling, add your investment business in our directory of the best wholesale property investors in Cobb County GA. This will let your possible investor buyers locate and reach you.

Factors to Consider

Median Home Prices

Median home prices in the community will show you if your designated price point is achievable in that market. A region that has a large pool of the below-market-value properties that your customers require will have a lower median home purchase price.

A sudden drop in housing prices might be followed by a sizeable selection of ’upside-down’ homes that short sale investors look for. Wholesaling short sale homes repeatedly delivers a number of uncommon benefits. But it also produces a legal risk. Discover more concerning wholesaling a short sale property from our extensive explanation. Once you have determined to try wholesaling short sale homes, make certain to engage someone on the list of the best short sale attorneys in Cobb County GA and the best foreclosure law firms in Cobb County GA to assist you.

Property Appreciation Rate

Property appreciation rate enhances the median price stats. Real estate investors who plan to sell their properties later, such as long-term rental investors, need a region where real estate purchase prices are growing. Decreasing purchase prices show an equally weak leasing and housing market and will chase away real estate investors.

Population Growth

Population growth numbers are crucial for your intended contract assignment purchasers. If they realize the population is expanding, they will decide that additional residential units are a necessity. There are more people who rent and additional clients who purchase real estate. A market with a shrinking population will not interest the real estate investors you want to purchase your contracts.

Median Population Age

Investors need to be a part of a robust property market where there is a substantial supply of tenants, newbie homebuyers, and upwardly mobile citizens moving to more expensive homes. A location that has a big workforce has a strong pool of tenants and buyers. When the median population age corresponds with the age of working adults, it demonstrates a dynamic residential market.

Income Rates

The median household and per capita income in a reliable real estate investment market need to be improving. Income increment demonstrates a location that can keep up with rent and housing purchase price surge. That will be crucial to the investors you need to attract.

Unemployment Rate

Real estate investors whom you offer to buy your contracts will regard unemployment statistics to be a key bit of insight. High unemployment rate prompts more tenants to delay rental payments or default altogether. Long-term investors who depend on timely lease payments will do poorly in these communities. Tenants cannot step up to property ownership and existing owners can’t liquidate their property and shift up to a bigger home. This makes it tough to find fix and flip real estate investors to purchase your contracts.

Number of New Jobs Created

Learning how often new jobs are generated in the area can help you see if the property is located in a stable housing market. People move into a community that has more jobs and they look for housing. Long-term real estate investors, such as landlords, and short-term investors like flippers, are drawn to communities with good job creation rates.

Average Renovation Costs

An important consideration for your client investors, specifically house flippers, are renovation expenses in the city. Short-term investors, like house flippers, can’t make money if the price and the rehab expenses equal to more than the After Repair Value (ARV) of the home. Look for lower average renovation costs.

This strategy includes obtaining a loan (mortgage note) from a mortgage holder at a discount. By doing so, you become the mortgage lender to the first lender’s debtor.

Loans that are being repaid as agreed are considered performing loans. Performing loans earn you monthly passive income. Some mortgage note investors buy non-performing notes because if the investor cannot successfully restructure the mortgage, they can always purchase the collateral property at foreclosure for a low amount.

One day, you could have a lot of mortgage notes and necessitate additional time to manage them without help. When this develops, you could pick from the best residential mortgage servicers in Cobb County GA which will make you a passive investor.

If you determine to adopt this plan, affix your venture to our directory of real estate note buyers in Cobb County GA. Being on our list puts you in front of lenders who make profitable investment opportunities available to note buyers such as yourself.

Factors to consider

Foreclosure Rates

Performing loan investors seek markets showing low foreclosure rates. If the foreclosures happen too often, the market might nevertheless be desirable for non-performing note buyers. The locale ought to be active enough so that note investors can foreclose and unload properties if required.

Foreclosure Laws

It is critical for mortgage note investors to know the foreclosure regulations in their state. Some states utilize mortgage paperwork and some utilize Deeds of Trust. A mortgage requires that you go to court for authority to foreclose. You only have to file a notice and start foreclosure steps if you are utilizing a Deed of Trust.

Mortgage Interest Rates

The interest rate is determined in the mortgage notes that are acquired by mortgage note investors. That mortgage interest rate will unquestionably impact your investment returns. Mortgage interest rates are significant to both performing and non-performing mortgage note buyers.

Conventional interest rates can vary by as much as a 0.25% throughout the US. Private loan rates can be a little more than traditional mortgage rates considering the more significant risk taken on by private lenders.

Note investors should always know the prevailing market interest rates, private and traditional, in potential investment markets.

Demographics

A region’s demographics statistics help mortgage note buyers to streamline their work and appropriately distribute their resources. The city’s population increase, unemployment rate, employment market increase, pay standards, and even its median age contain usable facts for investors.
Performing note buyers require homeowners who will pay without delay, developing a consistent revenue source of loan payments.

Note investors who acquire non-performing mortgage notes can also take advantage of growing markets. In the event that foreclosure is called for, the foreclosed collateral property is more conveniently sold in a good property market.

Property Values

As a note buyer, you will search for borrowers having a comfortable amount of equity. When the value isn’t higher than the mortgage loan balance, and the lender has to foreclose, the house might not sell for enough to payoff the loan. As loan payments lessen the amount owed, and the market value of the property increases, the homeowner’s equity increases.

Property Taxes

Escrows for property taxes are typically paid to the mortgage lender simultaneously with the mortgage loan payment. This way, the lender makes certain that the property taxes are paid when payable. The lender will need to compensate if the house payments stop or the investor risks tax liens on the property. If taxes are delinquent, the government’s lien leapfrogs any other liens to the head of the line and is satisfied first.

Because tax escrows are combined with the mortgage loan payment, increasing taxes mean higher mortgage payments. Delinquent borrowers may not have the ability to keep paying rising loan payments and could interrupt paying altogether.

Real Estate Market Strength

A community with appreciating property values offers excellent potential for any note investor. Because foreclosure is a crucial element of note investment strategy, growing real estate values are key to discovering a strong investment market.

Growing markets often open opportunities for private investors to make the first loan themselves. This is a profitable stream of income for accomplished investors.

A trust buying income-generating properties and that offers shares to others is a REIT — Real Estate Investment Trust. REITs are invented to empower ordinary people to buy into properties. The average person is able to come up with the money to invest in a REIT.

Shareholders in such organizations are entirely passive investors. REITs oversee investors’ liability with a diversified collection of assets. Shares in a REIT may be unloaded whenever it’s convenient for the investor. But REIT investors do not have the ability to select specific real estate properties or markets. Their investment is limited to the assets owned by their REIT.

Real estate investment funds are in essence mutual funds specializing in real estate firms, such as REITs. Any actual property is possessed by the real estate companies rather than the fund. These funds make it possible for more investors to invest in real estate properties. Funds aren’t required to distribute dividends unlike a REIT. Like other stocks, investment funds’ values grow and go down with their share market value.

You may select a fund that concentrates on a targeted kind of real estate you are expert in, but you do not get to pick the market of every real estate investment. You must rely on the fund’s managers to choose which markets and properties are chosen for investment.