Ultimate Kennesaw Real Estate Investing Guide for 2024

The acronym BRRRR is a description of a long-term investment plan — Buy, Rehab, Rent, Refinance, Repeat. BRRRR is a system for consistent growth. An important piece of this plan is to be able to do a “cash-out” refinance.

The After Repair Value (ARV) of the property has to total more than the total buying and refurbishment costs. Then you get a cash-out mortgage refinance loan that is calculated on the higher value, and you take out the difference. This money is placed into one more investment property, and so on. You add growing assets to your portfolio and lease income to your cash flow.

When an investor owns a significant portfolio of investment properties, it is wise to employ a property manager and designate a passive income source. Discover top real estate managers in Kennesaw GA by browsing our directory.

Factors to Consider

Population Growth

The rise or fall of the population can indicate whether that market is interesting to landlords. A growing population normally indicates active relocation which means additional tenants. The location is attractive to companies and workers to move, work, and grow households. This equates to stable tenants, more lease income, and a greater number of likely homebuyers when you intend to unload the property.

Property Taxes

Real estate taxes, upkeep, and insurance spendings are examined by long-term rental investors for determining costs to estimate if and how the efforts will work out. High property tax rates will decrease a real estate investor’s income. If property taxes are excessive in a given city, you probably need to look somewhere else.

Price to Rent Ratio

The price to rent ratio (p/r) is an illustration of what amount of rent can be charged compared to the purchase price of the investment property. If median property values are steep and median rents are low — a high p/r, it will take more time for an investment to pay for itself and achieve profitability. You want to find a low p/r to be comfortable that you can set your rents high enough to reach acceptable profits.

Median Gross Rents

Median gross rents are a true barometer of the desirability of a lease market under consideration. You want to discover a site with stable median rent increases. Dropping rental rates are a bad signal to long-term investor landlords.

Median Population Age

The median citizens’ age that you are looking for in a favorable investment environment will be close to the age of working individuals. You will find this to be accurate in locations where workers are migrating. If working-age people aren’t entering the city to replace retirees, the median age will go up. This is not advantageous for the forthcoming financial market of that region.

Employment Base Diversity

A greater amount of enterprises in the location will expand your chances of better income. When people are employed by only several significant businesses, even a little disruption in their business could cause you to lose a great deal of tenants and expand your exposure immensely.

Unemployment Rate

High unemployment equals smaller amount of renters and an unsteady housing market. Non-working individuals will not be able to purchase goods or services. This can cause a high amount of dismissals or reduced work hours in the market. This may result in delayed rents and defaults.

Income Rates

Median household and per capita income will reflect if the tenants that you prefer are residing in the location. Your investment research will consider rental charge and property appreciation, which will depend on wage augmentation in the region.

Number of New Jobs Created

The active economy that you are searching for will create plenty of jobs on a constant basis. The people who take the new jobs will have to have a place to live. This reassures you that you will be able to retain an acceptable occupancy rate and buy more rentals.

School Ratings

School reputation in the district will have a significant effect on the local housing market. Employers that are thinking about relocating want high quality schools for their workers. Moving employers relocate and draw prospective tenants. Real estate prices gain thanks to new workers who are buying houses. Quality schools are a vital component for a robust property investment market.

Property Appreciation Rates

Property appreciation rates are an imperative ingredient of your long-term investment scheme. Investing in real estate that you expect to keep without being certain that they will appreciate in price is a recipe for disaster. Low or dropping property appreciation rates will exclude a city from consideration.

Residential units where renters stay in furnished spaces for less than thirty days are referred to as short-term rentals. The nightly rental prices are always higher in short-term rentals than in long-term ones. With tenants not staying long, short-term rental units need to be repaired and sanitized on a continual basis.

House sellers waiting to move into a new house, vacationers, and individuals on a business trip who are stopping over in the community for a few days enjoy renting a residence short term. Ordinary real estate owners can rent their houses or condominiums on a short-term basis with sites such as AirBnB and VRBO. Short-term rentals are deemed as a good approach to embark upon investing in real estate.

Short-term rentals require interacting with occupants more repeatedly than long-term rentals. Because of this, investors handle problems regularly. You may need to cover your legal liability by working with one of the best Kennesaw law firms for real estate.

Factors to Consider

Short-Term Rental Income

Initially, calculate how much rental income you need to meet your projected profits. Understanding the standard amount of rent being charged in the area for short-term rentals will allow you to select a profitable place to invest.

Median Property Prices

When acquiring property for short-term rentals, you have to calculate the budget you can allot. Search for cities where the purchase price you count on corresponds with the existing median property worth. You can also make use of median market worth in localized neighborhoods within the market to choose communities for investment.

Price Per Square Foot

Price per sq ft can be influenced even by the look and layout of residential properties. When the designs of available homes are very contrasting, the price per square foot might not help you get a definitive comparison. If you remember this, the price per sq ft can give you a basic view of property prices.

Short-Term Rental Occupancy Rate

The necessity for additional rentals in a market can be determined by studying the short-term rental occupancy level. When the majority of the rental units have tenants, that location demands additional rental space. When the rental occupancy indicators are low, there is not much place in the market and you should look somewhere else.

Short-Term Rental Cash-on-Cash Return

A short-term rental’s cash-on-cash return will tell you if the investment is a logical use of your money. Divide the Net Operating Income (NOI) by the total amount of cash used. The result will be a percentage. The higher it is, the quicker your investment funds will be returned and you’ll start receiving profits. Lender-funded purchases will show better cash-on-cash returns because you will be utilizing less of your own funds.

Average Short-Term Rental Capitalization (Cap) Rates

This metric compares investment property value to its annual return. High cap rates show that income-producing assets are accessible in that city for reasonable prices. When cap rates are low, you can assume to pay more money for rental units in that community. The cap rate is computed by dividing the Net Operating Income (NOI) by the asking price or market worth. The percentage you receive is the investment property’s cap rate.

Local Attractions

Short-term rental units are popular in communities where sightseers are attracted by events and entertainment spots. This includes top sporting tournaments, children’s sports contests, schools and universities, large concert halls and arenas, festivals, and amusement parks. Outdoor tourist spots such as mountains, lakes, coastal areas, and state and national parks can also attract future tenants.

To fix and flip a property, you have to pay lower than market worth, perform any needed repairs and updates, then sell the asset for after-repair market worth. Your calculation of repair expenses has to be on target, and you should be capable of acquiring the unit for less than market value.

Explore the housing market so that you understand the accurate After Repair Value (ARV). You always want to analyze how long it takes for real estate to sell, which is determined by the Days on Market (DOM) indicator. Selling real estate immediately will keep your expenses low and guarantee your returns.

To help motivated home sellers locate you, place your firm in our lists of cash home buyers in Kennesaw GA and property investment firms in Kennesaw GA.

In addition, coordinate with Kennesaw real estate bird dogs. These experts specialize in rapidly discovering promising investment opportunities before they are listed on the open market.

Factors to Consider

Median Home Price

When you search for a suitable market for house flipping, examine the median home price in the neighborhood. Low median home values are an indication that there should be a good number of real estate that can be acquired for less than market value. This is a basic ingredient of a fix and flip market.

If regional data shows a sudden drop in real estate market values, this can point to the availability of possible short sale homes. You’ll find out about possible opportunities when you team up with Kennesaw short sale negotiation companies. Find out how this is done by reading our guide ⁠— What Are the Steps to Buying a Short Sale Home?.

Property Appreciation Rate

The movements in real property prices in a region are crucial. Predictable growth in median prices demonstrates a strong investment market. Housing market worth in the area should be increasing regularly, not rapidly. When you are buying and selling rapidly, an uncertain market can hurt you.

Average Renovation Costs

A careful review of the city’s building expenses will make a substantial difference in your area selection. The time it requires for getting permits and the municipality’s requirements for a permit application will also affect your decision. To draft an on-target financial strategy, you will need to understand whether your construction plans will have to involve an architect or engineer.

Population Growth

Population data will tell you whether there is a growing demand for housing that you can sell. When there are buyers for your repaired houses, it will demonstrate a strong population growth.

Median Population Age

The median population age is a clear sign of the accessibility of potential home purchasers. The median age in the market must equal the age of the usual worker. These are the individuals who are active homebuyers. The requirements of retirees will most likely not fit into your investment project plans.

Unemployment Rate

You want to have a low unemployment level in your prospective region. It must certainly be lower than the national average. When the city’s unemployment rate is less than the state average, that is a sign of a preferable financial market. If you don’t have a vibrant employment base, a city cannot supply you with enough homebuyers.

Income Rates

Median household and per capita income are a great gauge of the robustness of the real estate environment in the location. The majority of people who purchase a home have to have a mortgage loan. Home purchasers’ eligibility to get approval for a loan hinges on the level of their wages. The median income statistics will show you if the region is appropriate for your investment project. Specifically, income growth is vital if you need to scale your investment business. Construction spendings and housing purchase prices increase from time to time, and you want to know that your potential clients’ salaries will also climb up.

Number of New Jobs Created

Knowing how many jobs appear per annum in the community can add to your confidence in a community’s investing environment. A higher number of citizens acquire homes when the local financial market is adding new jobs. With a higher number of jobs appearing, more prospective homebuyers also come to the area from other locations.

Hard Money Loan Rates

Those who buy, fix, and sell investment homes like to engage hard money and not traditional real estate funding. This enables them to rapidly buy desirable real property. Find private money lenders for real estate in Kennesaw GA and estimate their mortgage rates.

In case you are inexperienced with this financing type, discover more by studying our informative blog post — How Does a Hard Money Loan Work in Real Estate?.

Wholesaling is a real estate investment strategy that involves finding properties that are appealing to real estate investors and putting them under a sale and purchase agreement. When an investor who approves of the residential property is spotted, the purchase contract is sold to the buyer for a fee. The property is bought by the investor, not the real estate wholesaler. The real estate wholesaler does not sell the property — they sell the contract to buy it.

Wholesaling hinges on the involvement of a title insurance firm that is comfortable with assigning purchase contracts and comprehends how to work with a double closing. Locate title companies that work with investors in Kennesaw GA that we selected for you.

Discover more about the way to wholesale property from our complete guide — Real Estate Wholesaling 101. When employing this investment plan, add your firm in our directory of the best home wholesalers in Kennesaw GA. This will let your future investor clients locate and call you.

Factors to Consider

Median Home Prices

Median home values in the city under consideration will immediately tell you if your investors’ required properties are situated there. Lower median purchase prices are a valid indicator that there are enough homes that can be bought below market value, which investors need to have.

A fast drop in the market value of property might generate the sudden appearance of homes with owners owing more than market worth that are desired by wholesalers. Short sale wholesalers frequently receive advantages from this method. Nevertheless, it also creates a legal risk. Get additional data on how to wholesale a short sale house in our exhaustive explanation. When you are keen to start wholesaling, search through Kennesaw top short sale attorneys as well as Kennesaw top-rated property foreclosure attorneys lists to locate the appropriate advisor.

Property Appreciation Rate

Property appreciation rate completes the median price stats. Some real estate investors, like buy and hold and long-term rental landlords, particularly need to see that home prices in the market are growing steadily. A declining median home price will indicate a weak rental and housing market and will eliminate all kinds of investors.

Population Growth

Population growth data is something that real estate investors will consider in greater detail. If the community is growing, new housing is needed. There are a lot of individuals who rent and more than enough clients who buy real estate. A location with a shrinking community does not draw the investors you want to purchase your contracts.

Median Population Age

Real estate investors want to participate in a reliable housing market where there is a substantial pool of renters, newbie homeowners, and upwardly mobile residents purchasing more expensive houses. For this to happen, there has to be a solid employment market of potential renters and homebuyers. A market with these characteristics will display a median population age that matches the employed person’s age.

Income Rates

The median household and per capita income in a robust real estate investment market need to be on the upswing. Income improvement demonstrates a city that can absorb rental rate and home listing price increases. Successful investors stay out of cities with unimpressive population income growth numbers.

Unemployment Rate

The location’s unemployment numbers will be a vital point to consider for any prospective wholesale property buyer. High unemployment rate forces more tenants to make late rent payments or miss payments entirely. This is detrimental to long-term real estate investors who intend to lease their real estate. High unemployment causes uncertainty that will prevent interested investors from buying a house. This is a problem for short-term investors buying wholesalers’ agreements to repair and resell a home.

Number of New Jobs Created

The frequency of jobs created yearly is a crucial component of the housing structure. New citizens settle in a location that has fresh job openings and they require a place to reside. This is good for both short-term and long-term real estate investors whom you rely on to take on your sale contracts.

Average Renovation Costs

Rehabilitation expenses have a major influence on a flipper’s profit. The cost of acquisition, plus the costs of repairs, must be less than the After Repair Value (ARV) of the house to ensure profit. Below average remodeling spendings make a market more attractive for your main buyers — flippers and rental property investors.

Buying mortgage notes (loans) is successful when the note can be purchased for less than the remaining balance. When this occurs, the investor becomes the debtor’s lender.

Loans that are being paid as agreed are considered performing notes. They give you stable passive income. Some mortgage investors like non-performing notes because if the investor cannot satisfactorily restructure the loan, they can always take the collateral property at foreclosure for a below market amount.

Eventually, you might accrue a number of mortgage note investments and be unable to service the portfolio alone. At that time, you may need to employ our catalogue of Kennesaw top home loan servicers and redesignate your notes as passive investments.

If you choose to utilize this method, add your business to our list of mortgage note buying companies in Kennesaw GA. This will help you become more noticeable to lenders providing lucrative possibilities to note investors like yourself.

Factors to Consider

Foreclosure Rates

Investors looking for valuable mortgage loans to buy will want to see low foreclosure rates in the market. Non-performing loan investors can carefully make use of places that have high foreclosure rates as well. But foreclosure rates that are high can signal a weak real estate market where liquidating a foreclosed unit might be tough.

Foreclosure Laws

Investors are expected to know their state’s regulations concerning foreclosure prior to pursuing this strategy. Are you faced with a Deed of Trust or a mortgage? When using a mortgage, a court will have to approve a foreclosure. A Deed of Trust enables the lender to file a public notice and continue to foreclosure.

Mortgage Interest Rates

Mortgage note investors take over the interest rate of the loan notes that they buy. This is a significant factor in the investment returns that you reach. Interest rates are crucial to both performing and non-performing note investors.

The mortgage loan rates quoted by traditional mortgage lenders are not equal everywhere. Private loan rates can be a little higher than conventional rates due to the higher risk taken on by private mortgage lenders.

A mortgage note buyer ought to know the private and conventional mortgage loan rates in their markets at any given time.

Demographics

When note investors are deciding on where to buy notes, they’ll examine the demographic data from potential markets. The area’s population increase, employment rate, employment market growth, income standards, and even its median age hold important information for you.
Mortgage note investors who invest in performing notes select markets where a lot of younger people have good-paying jobs.

Non-performing note investors are reviewing related indicators for different reasons. A vibrant regional economy is needed if investors are to find buyers for collateral properties they’ve foreclosed on.

Property Values

The greater the equity that a homebuyer has in their home, the more advantageous it is for the mortgage loan holder. When the property value is not significantly higher than the mortgage loan amount, and the mortgage lender decides to start foreclosure, the property might not realize enough to repay the lender. The combination of loan payments that lessen the mortgage loan balance and annual property market worth appreciation increases home equity.

Property Taxes

Many borrowers pay property taxes to lenders in monthly portions along with their mortgage loan payments. The lender pays the payments to the Government to ensure they are submitted promptly. If mortgage loan payments are not current, the lender will have to either pay the taxes themselves, or the property taxes become past due. When taxes are past due, the municipality’s lien supersedes any other liens to the head of the line and is satisfied first.

If property taxes keep going up, the client’s house payments also keep going up. This makes it hard for financially challenged homeowners to make their payments, and the loan could become past due.

Real Estate Market Strength

A location with increasing property values promises excellent potential for any note buyer. As foreclosure is a critical component of note investment strategy, appreciating property values are key to locating a good investment market.

Vibrant markets often provide opportunities for private investors to originate the initial mortgage loan themselves. For veteran investors, this is a profitable part of their business plan.

A trust that owns income-generating real estate and that sells shares to others is a REIT — Real Estate Investment Trust. Before REITs were invented, real estate investing was too costly for most citizens. Most people currently are able to invest in a REIT.

Shareholders in these trusts are totally passive investors. The liability that the investors are assuming is diversified within a collection of investment properties. Shares in a REIT may be liquidated whenever it is desirable for you. However, REIT investors don’t have the capability to pick individual investment properties or markets. You are confined to the REIT’s selection of properties for investment.

A Real Estate Investment Fund is a mutual fund that holds stocks of real estate companies. The fund does not own real estate — it owns interest in real estate firms. These funds make it feasible for a wider variety of investors to invest in real estate. Fund members may not collect regular distributions like REIT members do. The profit to the investor is created by increase in the value of the stock.

You can select a fund that specializes in a particular kind of real estate business, like commercial, but you can’t select the fund’s investment assets or markets. You must depend on the fund’s managers to choose which markets and assets are picked for investment.