Ultimate East Point Real Estate Investing Guide for 2024

BRRRR stands for “Buy, Rehab, Rent, Refinance, Repeat”. BRRRR is a strategy for continuous growth. It is a must that you are qualified to obtain a “cash-out” refinance for the strategy to work.

You add to the worth of the asset above what you spent acquiring and rehabbing the asset. The rental is refinanced based on the ARV and the difference, or equity, comes to you in cash. You acquire your next investment property with the cash-out funds and start anew. You acquire more and more assets and repeatedly grow your rental income.

If an investor has a substantial portfolio of investment properties, it is wise to pay a property manager and create a passive income source. Locate the best real estate management companies in East Point GA by using our directory.

Factors to Consider

Population Growth

The rise or decline of a market’s population is an accurate gauge of the community’s long-term desirability for rental investors. When you find good population growth, you can be certain that the community is drawing likely tenants to it. The market is attractive to companies and working adults to move, work, and have households. An expanding population develops a stable foundation of tenants who can keep up with rent bumps, and a vibrant seller’s market if you want to unload your assets.

Property Taxes

Property taxes, upkeep, and insurance costs are considered by long-term lease investors for computing costs to estimate if and how the efforts will be successful. Steep real estate tax rates will hurt a real estate investor’s profits. Regions with excessive property tax rates aren’t considered a dependable setting for short- and long-term investment and need to be avoided.

Price to Rent Ratio

Price to rent ratio (p/r) is a market signal that tells you how much you can anticipate to charge for rent. An investor will not pay a steep price for an investment property if they can only demand a modest rent not allowing them to repay the investment within a reasonable timeframe. The less rent you can demand the higher the p/r, with a low p/r indicating a stronger rent market.

Median Gross Rents

Median gross rents demonstrate whether a city’s lease market is dependable. Search for a steady rise in median rents year over year. If rental rates are declining, you can drop that community from deliberation.

Median Population Age

Median population age should be close to the age of a usual worker if a community has a good supply of renters. This could also signal that people are moving into the market. A high median age illustrates that the current population is aging out with no replacement by younger people moving in. This isn’t advantageous for the impending financial market of that market.

Employment Base Diversity

A varied employment base is something a smart long-term rental property investor will hunt for. If there are only one or two significant hiring companies, and one of them moves or disappears, it will make you lose paying customers and your property market worth to go down.

Unemployment Rate

You can’t have a stable rental income stream in a market with high unemployment. The unemployed cannot purchase products or services. This can generate a large number of dismissals or reduced work hours in the region. This may result in delayed rent payments and tenant defaults.

Income Rates

Median household and per capita income levels let you know if a high amount of preferred renters live in that location. Your investment study will include rental rate and investment real estate appreciation, which will be dependent on salary raise in the market.

Number of New Jobs Created

A growing job market results in a steady source of renters. A larger amount of jobs mean more renters. Your objective of leasing and buying more rentals requires an economy that can develop enough jobs.

School Ratings

Local schools can have a major influence on the real estate market in their location. When a business considers an area for possible expansion, they remember that good education is a must-have for their workers. Business relocation attracts more renters. Property values rise thanks to new workers who are buying homes. Superior schools are a necessary requirement for a strong real estate investment market.

Property Appreciation Rates

The basis of a long-term investment plan is to keep the property. You have to be positive that your property assets will increase in market price until you want to sell them. Low or decreasing property appreciation rates should exclude a community from your choices.

A furnished residence where clients stay for shorter than 30 days is called a short-term rental. Short-term rental businesses charge more rent a night than in long-term rental business. Short-term rental properties could involve more periodic repairs and cleaning.

Short-term rentals appeal to people traveling for business who are in the region for a couple of nights, those who are migrating and need transient housing, and tourists. House sharing sites like AirBnB and VRBO have enabled many real estate owners to join in the short-term rental business. This makes short-term rental strategy an easy way to try real estate investing.

Short-term rentals involve dealing with renters more repeatedly than long-term rental units. Because of this, investors handle difficulties regularly. Think about handling your exposure with the assistance of one of the good real estate attorneys in East Point GA.

Factors to Consider

Short-Term Rental Income

You have to imagine the level of rental revenue you are looking for based on your investment budget. A city’s short-term rental income rates will promptly reveal to you if you can assume to accomplish your estimated rental income levels.

Median Property Prices

You also must decide the amount you can allow to invest. To see if an area has possibilities for investment, investigate the median property prices. You can narrow your property hunt by analyzing median values in the location’s sub-markets.

Price Per Square Foot

Price per square foot can be misleading if you are examining different properties. When the styles of available homes are very different, the price per sq ft may not provide a valid comparison. Price per sq ft may be a quick way to compare several communities or properties.

Short-Term Rental Occupancy Rate

The need for additional rental units in a city can be determined by analyzing the short-term rental occupancy rate. A high occupancy rate signifies that an additional amount of short-term rental space is required. When the rental occupancy levels are low, there isn’t much place in the market and you should look elsewhere.

Short-Term Rental Cash-on-Cash Return

A short-term rental’s cash-on-cash return will tell you if the purchase is a good use of your money. Divide the Net Operating Income (NOI) by the total amount of cash used. The return is shown as a percentage. High cash-on-cash return demonstrates that you will regain your cash quicker and the purchase will have a higher return. Loan-assisted ventures will have a stronger cash-on-cash return because you will be spending less of your capital.

Average Short-Term Rental Capitalization (Cap) Rates

Another measurement indicates the value of real estate as a cash flow asset — average short-term rental capitalization (cap) rate. Usually, the less a unit will cost (or is worth), the higher the cap rate will be. If cap rates are low, you can prepare to spend a higher amount for investment properties in that region. The cap rate is computed by dividing the Net Operating Income (NOI) by the price or market value. This gives you a percentage that is the yearly return, or cap rate.

Local Attractions

Big festivals and entertainment attractions will attract visitors who will look for short-term rental homes. Vacationers visit specific areas to watch academic and athletic activities at colleges and universities, see professional sports, support their kids as they participate in kiddie sports, have the time of their lives at yearly festivals, and drop by adventure parks. Natural tourist sites such as mountains, waterways, coastal areas, and state and national nature reserves will also draw potential renters.

When a property investor buys a property cheaper than its market worth, repairs it so that it becomes more attractive and pricier, and then sells the house for revenue, they are referred to as a fix and flip investor. Your estimate of fix-up expenses must be on target, and you need to be able to buy the home for lower than market price.

Analyze the housing market so that you are aware of the accurate After Repair Value (ARV). You always have to check the amount of time it takes for properties to sell, which is shown by the Days on Market (DOM) metric. To effectively “flip” a property, you must sell the renovated home before you are required to put out capital to maintain it.

To help motivated home sellers discover you, enter your business in our directories of companies that buy homes for cash in East Point GA and property investors in East Point GA.

Additionally, hunt for top real estate bird dogs in East Point GA. Specialists in our directory specialize in procuring distressed property investments while they’re still off the market.

Factors to Consider

Median Home Price

When you look for a suitable region for property flipping, research the median housing price in the community. Low median home prices are an indication that there is a steady supply of real estate that can be bought for lower than market worth. This is an essential element of a cost-effective fix and flip.

If area data signals a quick decrease in property market values, this can indicate the accessibility of potential short sale homes. You can be notified concerning these opportunities by joining with short sale negotiators in East Point GA. Learn how this works by reading our article ⁠— How Do You Buy a House in a Short Sale?.

Property Appreciation Rate

The shifts in real property market worth in a city are critical. Fixed increase in median prices articulates a vibrant investment market. Rapid market worth surges can indicate a market value bubble that isn’t reliable. When you’re purchasing and selling quickly, an erratic environment can sabotage your efforts.

Average Renovation Costs

A thorough analysis of the area’s construction expenses will make a substantial difference in your location choice. Other costs, such as certifications, could increase your budget, and time which may also turn into additional disbursement. If you are required to show a stamped suite of plans, you’ll need to include architect’s charges in your expenses.

Population Growth

Population growth statistics allow you to take a peek at housing need in the region. Flat or decelerating population growth is an indicator of a weak market with not a lot of buyers to validate your risk.

Median Population Age

The median residents’ age is an indicator that you might not have considered. The median age in the community should equal the age of the typical worker. Employed citizens can be the individuals who are possible home purchasers. The needs of retired people will most likely not suit your investment venture strategy.

Unemployment Rate

When you stumble upon a market that has a low unemployment rate, it is a good indicator of good investment opportunities. An unemployment rate that is less than the national average is good. A positively friendly investment area will have an unemployment rate less than the state’s average. Without a dynamic employment base, a community cannot provide you with enough home purchasers.

Income Rates

Median household and per capita income are a solid sign of the robustness of the home-purchasing conditions in the community. Most families need to take a mortgage to purchase a house. The borrower’s wage will determine how much they can afford and whether they can purchase a house. The median income levels show you if the market is eligible for your investment plan. In particular, income growth is vital if you need to expand your business. If you want to augment the price of your houses, you want to be sure that your homebuyers’ salaries are also going up.

Number of New Jobs Created

The number of jobs created on a regular basis indicates if salary and population increase are viable. Homes are more quickly liquidated in a market with a vibrant job market. Competent skilled employees taking into consideration buying a house and settling opt for migrating to cities where they won’t be jobless.

Hard Money Loan Rates

Investors who work with rehabbed residential units regularly employ hard money funding in place of conventional funding. This allows investors to rapidly pick up desirable real estate. Find real estate hard money lenders in East Point GA and analyze their rates.

If you are unfamiliar with this funding type, discover more by reading our guide — Hard Money Loans Guide for Real Estate Investors.

Wholesaling is a real estate investment approach that involves locating properties that are appealing to real estate investors and putting them under a sale and purchase agreement. When a real estate investor who approves of the residential property is spotted, the purchase contract is assigned to the buyer for a fee. The real buyer then finalizes the purchase. The wholesaler doesn’t liquidate the residential property — they sell the rights to purchase it.

Wholesaling depends on the assistance of a title insurance company that is comfortable with assignment of real estate sale agreements and comprehends how to deal with a double closing. Look for title companies for wholesaling in East Point GA in HouseCashin’s list.

Learn more about the way to wholesale property from our comprehensive guide — Real Estate Wholesaling Explained for Beginners. When employing this investing plan, list your company in our directory of the best house wholesalers in East Point GA. That will help any possible customers to find you and get in touch.

Factors to Consider

Median Home Prices

Median home prices are essential to discovering cities where homes are selling in your real estate investors’ purchase price point. Since real estate investors need investment properties that are available below market price, you will want to take note of lower median prices as an implied hint on the potential source of residential real estate that you may acquire for below market worth.

A quick downturn in home worth might be followed by a hefty number of ’upside-down’ houses that short sale investors hunt for. This investment strategy often carries multiple particular advantages. Nonetheless, there may be risks as well. Find out about this from our guide How Can You Wholesale a Short Sale Property?. Once you’re keen to start wholesaling, look through East Point top short sale lawyers as well as East Point top-rated foreclosure law firms directories to discover the appropriate counselor.

Property Appreciation Rate

Property appreciation rate enhances the median price statistics. Some investors, such as buy and hold and long-term rental investors, particularly want to find that home market values in the city are going up steadily. A dropping median home value will illustrate a weak leasing and housing market and will eliminate all types of investors.

Population Growth

Population growth information is crucial for your prospective contract assignment buyers. A growing population will require additional residential units. There are more individuals who lease and plenty of customers who buy real estate. When a population is not multiplying, it does not need more residential units and investors will invest in other areas.

Median Population Age

A robust housing market needs people who are initially leasing, then shifting into homebuyers, and then moving up in the housing market. To allow this to take place, there has to be a reliable employment market of prospective renters and homeowners. A location with these attributes will show a median population age that corresponds with the working citizens’ age.

Income Rates

The median household and per capita income in a good real estate investment market have to be on the upswing. If tenants’ and home purchasers’ wages are increasing, they can contend with soaring lease rates and residential property purchase costs. Experienced investors stay away from cities with poor population wage growth numbers.

Unemployment Rate

Investors will pay close attention to the city’s unemployment rate. Overdue rent payments and lease default rates are widespread in places with high unemployment. Long-term investors who rely on reliable rental income will lose revenue in these places. High unemployment builds uncertainty that will prevent interested investors from buying a house. This is a concern for short-term investors buying wholesalers’ contracts to repair and resell a property.

Number of New Jobs Created

The number of jobs created annually is an important part of the housing picture. Job creation implies additional employees who need a place to live. Long-term investors, like landlords, and short-term investors such as rehabbers, are drawn to locations with strong job appearance rates.

Average Renovation Costs

An indispensable consideration for your client investors, particularly house flippers, are rehab expenses in the community. When a short-term investor flips a building, they have to be prepared to unload it for more money than the total sum they spent for the purchase and the improvements. Lower average renovation costs make a location more attractive for your main buyers — rehabbers and other real estate investors.

Purchasing mortgage notes (loans) works when the note can be acquired for less than the remaining balance. By doing so, the investor becomes the lender to the first lender’s borrower.

Loans that are being paid off on time are referred to as performing notes. These loans are a steady provider of cash flow. Non-performing mortgage notes can be restructured or you can pick up the property at a discount by conducting foreclosure.

At some time, you might grow a mortgage note portfolio and start lacking time to manage it by yourself. If this occurs, you might choose from the best residential mortgage servicers in East Point GA which will designate you as a passive investor.

Should you decide to adopt this investment model, you should place your project in our list of the best real estate note buying companies in East Point GA. Joining will make your business more noticeable to lenders providing lucrative possibilities to note buyers like you.

Factors to Consider

Foreclosure Rates

Performing note investors seek communities having low foreclosure rates. Non-performing mortgage note investors can carefully make use of places that have high foreclosure rates too. If high foreclosure rates have caused a slow real estate environment, it may be tough to liquidate the collateral property after you foreclose on it.

Foreclosure Laws

Investors should know their state’s laws concerning foreclosure before investing in mortgage notes. They’ll know if their state uses mortgage documents or Deeds of Trust. When using a mortgage, a court has to allow a foreclosure. Lenders don’t need the judge’s permission with a Deed of Trust.

Mortgage Interest Rates

Purchased mortgage loan notes have an agreed interest rate. Your investment profits will be impacted by the mortgage interest rate. Interest rates impact the plans of both types of note investors.

Conventional lenders price dissimilar interest rates in different locations of the US. Mortgage loans issued by private lenders are priced differently and can be more expensive than traditional mortgages.

A note buyer needs to know the private as well as conventional mortgage loan rates in their communities at any given time.

Demographics

A community’s demographics information assist mortgage note investors to streamline their work and appropriately distribute their assets. The neighborhood’s population growth, unemployment rate, job market increase, wage standards, and even its median age hold important data for mortgage note investors.
Performing note investors want homeowners who will pay on time, developing a consistent revenue flow of loan payments.

The identical area could also be beneficial for non-performing note investors and their end-game strategy. A strong regional economy is required if investors are to find buyers for collateral properties on which they have foreclosed.

Property Values

As a mortgage note buyer, you must search for deals with a comfortable amount of equity. This improves the possibility that a possible foreclosure liquidation will make the lender whole. The combined effect of loan payments that lower the loan balance and yearly property value appreciation raises home equity.

Property Taxes

Usually, lenders receive the property taxes from the homeowner every month. So the lender makes sure that the real estate taxes are taken care of when payable. If the homeowner stops performing, unless the lender takes care of the taxes, they will not be paid on time. Tax liens go ahead of any other liens.

Since tax escrows are included with the mortgage loan payment, increasing property taxes mean higher mortgage loan payments. This makes it hard for financially weak homeowners to meet their obligations, so the loan might become past due.

Real Estate Market Strength

Both performing and non-performing mortgage note buyers can do business in a growing real estate environment. The investors can be assured that, if need be, a defaulted property can be sold at a price that makes a profit.

Growing markets often generate opportunities for private investors to generate the initial loan themselves. For successful investors, this is a profitable segment of their investment plan.

A trust owning income-generating real estate and that sells shares to people is a REIT — Real Estate Investment Trust. Before REITs existed, investing in properties was too expensive for most people. The everyday person is able to come up with the money to invest in a REIT.

Shareholders in REITs are completely passive investors. REITs oversee investors’ liability with a diversified group of properties. Participants have the capability to sell their shares at any time. Something you can’t do with REIT shares is to choose the investment real estate properties. The assets that the REIT chooses to acquire are the assets you invest in.

A Real Estate Investment Fund is a mutual fund that owns stocks of real estate firms. The investment assets are not possessed by the fund — they are possessed by the businesses the fund invests in. Investment funds can be an inexpensive way to include real estate in your allocation of assets without avoidable exposure. Fund shareholders might not receive usual disbursements like REIT shareholders do. The value of a fund to an investor is the anticipated appreciation of the price of the fund’s shares.

You can choose a fund that focuses on a selected type of real estate you’re knowledgeable about, but you don’t get to pick the market of every real estate investment. As passive investors, fund members are content to permit the directors of the fund determine all investment selections.