Ultimate Lewis County Real Estate Investing Guide for 2024

The abbreviation BRRRR is a description of a long-term lease strategy — Buy, Rehab, Rent, Refinance, Repeat. BRRRR is a strategy for consistent expansion. A crucial part of this formula is to be able to receive a “cash-out” mortgage refinance.

The After Repair Value (ARV) of the house needs to total more than the complete purchase and refurbishment expenses. The asset is refinanced using the ARV and the difference, or equity, is given to you in cash. This cash is placed into a different investment property, and so on. You add appreciating investment assets to the balance sheet and rental income to your cash flow.

If an investor holds a substantial portfolio of investment homes, it seems smart to pay a property manager and establish a passive income stream. Discover one of property management agencies in Lewis County WV with the help of our exhaustive directory.

Factors to Consider

Population Growth

The increase or decline of a market’s population is a valuable gauge of its long-term attractiveness for rental investors. If the population growth in an area is robust, then additional renters are definitely moving into the region. Businesses think of this community as an attractive region to situate their enterprise, and for employees to move their families. This equals dependable renters, greater lease income, and more possible homebuyers when you want to sell the property.

Property Taxes

Real estate taxes, ongoing maintenance spendings, and insurance specifically affect your revenue. Excessive spendings in these categories threaten your investment’s bottom line. Locations with unreasonable property tax rates are not a reliable situation for short- or long-term investment and must be bypassed.

Price to Rent Ratio

The price to rent ratio (p/r) is a contrast of median property prices and median lease rates that will show you how high of a rent the market can tolerate. If median home values are steep and median rents are weak — a high p/r — it will take longer for an investment to repay your costs and attain profitability. A high p/r signals you that you can demand less rent in that community, a lower one shows that you can demand more.

Median Gross Rents

Median gross rents are a true barometer of the acceptance of a lease market under discussion. Hunt for a continuous increase in median rents year over year. Declining rental rates are an alert to long-term investor landlords.

Median Population Age

Median population age in a dependable long-term investment environment should mirror the normal worker’s age. This can also illustrate that people are relocating into the market. When working-age people are not venturing into the city to take over from retiring workers, the median age will increase. That is a weak long-term financial picture.

Employment Base Diversity

Accommodating multiple employers in the community makes the market not as volatile. When the residents are concentrated in a few significant businesses, even a small disruption in their operations could cost you a great deal of renters and expand your risk significantly.

Unemployment Rate

You won’t reap the benefits of a stable rental cash flow in an area with high unemployment. Out-of-work residents cease being customers of yours and of related businesses, which produces a domino effect throughout the market. The remaining people could find their own wages marked down. Remaining tenants may fall behind on their rent payments in this situation.

Income Rates

Median household and per capita income stats help you to see if a sufficient number of ideal tenants reside in that region. Increasing salaries also tell you that rental fees can be hiked throughout the life of the rental home.

Number of New Jobs Created

The more jobs are constantly being created in an area, the more dependable your tenant pool will be. The employees who are employed for the new jobs will require housing. This enables you to acquire additional rental assets and replenish existing vacancies.

School Ratings

The status of school districts has a significant impact on housing values across the city. When an employer evaluates a market for potential expansion, they know that first-class education is a requirement for their workforce. Reliable tenants are a by-product of a vibrant job market. Home market values benefit thanks to new employees who are purchasing properties. You can’t find a vibrantly soaring housing market without good schools.

Property Appreciation Rates

The foundation of a long-term investment method is to hold the asset. You need to have confidence that your property assets will rise in market price until you want to liquidate them. You don’t want to take any time navigating cities showing low property appreciation rates.

A short-term rental is a furnished apartment or house where a renter stays for less than four weeks. Short-term rental landlords charge a steeper rate per night than in long-term rental business. Because of the high rotation of renters, short-term rentals necessitate more regular repairs and sanitation.

Short-term rentals are used by clients travelling for work who are in the area for a couple of nights, people who are moving and need short-term housing, and holidaymakers. Anyone can convert their residence into a short-term rental with the assistance provided by online home-sharing portals like VRBO and AirBnB. Short-term rentals are thought of as a good way to embark upon investing in real estate.

Short-term rental unit landlords necessitate dealing personally with the occupants to a greater degree than the owners of yearly rented properties. This results in the landlord being required to frequently handle protests. Consider handling your liability with the support of any of the top real estate law firms in Lewis County WV.

Factors to Consider

Short-Term Rental Income

You should decide how much rental income needs to be created to make your investment profitable. Learning about the standard rate of rental fees in the market for short-term rentals will enable you to select a desirable city to invest.

Median Property Prices

Thoroughly calculate the budget that you can afford to pay for new real estate. To check if a market has possibilities for investment, investigate the median property prices. You can customize your property hunt by looking at median market worth in the location’s sub-markets.

Price Per Square Foot

Price per sq ft can be inaccurate if you are looking at different buildings. A home with open entrances and high ceilings can’t be compared with a traditional-style residential unit with larger floor space. You can use the price per sq ft data to obtain a good broad view of housing values.

Short-Term Rental Occupancy Rate

The number of short-term rentals that are currently occupied in an area is critical information for a landlord. If the majority of the rental units are full, that location needs more rentals. Weak occupancy rates mean that there are already too many short-term rentals in that area.

Short-Term Rental Cash-on-Cash Return

A short-term rental’s cash-on-cash return can tell you if the venture is a logical use of your money. You can determine the cash-on-cash return by taking your Net Operating Income (NOI) and dividing it by your cash being invested. The answer is a percentage. When a project is lucrative enough to repay the capital spent promptly, you’ll have a high percentage. Loan-assisted ventures will have a higher cash-on-cash return because you’re spending less of your money.

Average Short-Term Rental Capitalization (Cap) Rates

Average short-term rental capitalization (cap) levels are commonly used by real estate investors to estimate the market value of rental units. Generally, the less money a unit will cost (or is worth), the higher the cap rate will be. If cap rates are low, you can expect to pay more for rental units in that location. The cap rate is computed by dividing the Net Operating Income (NOI) by the asking price or market value. The percentage you get is the property’s cap rate.

Local Attractions

Important festivals and entertainment attractions will draw visitors who will look for short-term housing. People come to specific areas to enjoy academic and sporting events at colleges and universities, be entertained by competitions, cheer for their kids as they participate in kiddie sports, have fun at annual festivals, and stop by amusement parks. Popular vacation spots are located in mountain and coastal areas, along rivers, and national or state nature reserves.

To fix and flip a property, you should get it for lower than market worth, make any required repairs and enhancements, then sell it for after-repair market worth. Your calculation of renovation costs should be correct, and you should be able to buy the property for less than market value.

You also have to analyze the housing market where the house is positioned. The average number of Days On Market (DOM) for houses sold in the area is vital. As a “house flipper”, you’ll want to sell the renovated real estate immediately so you can stay away from carrying ongoing costs that will reduce your profits.

So that home sellers who need to unload their property can easily discover you, highlight your status by utilizing our directory of the best cash house buyers in Lewis County WV along with the best real estate investment companies in Lewis County WV.

Additionally, coordinate with Lewis County bird dogs for real estate investors. These experts concentrate on rapidly discovering good investment prospects before they come on the market.

Factors to Consider

Median Home Price

When you search for a promising market for real estate flipping, look into the median house price in the district. If values are high, there may not be a steady supply of run down real estate in the location. This is a crucial element of a successful investment.

If you see a quick weakening in home market values, this might signal that there are possibly houses in the neighborhood that will work for a short sale. Real estate investors who partner with short sale processors in Lewis County WV get continual notifications concerning potential investment real estate. You’ll learn additional information about short sales in our article ⁠— What Is the Process of Buying a Short Sale Home?.

Property Appreciation Rate

Are home values in the market going up, or going down? Steady growth in median prices articulates a vibrant investment environment. Home market values in the city need to be growing consistently, not quickly. When you are acquiring and liquidating quickly, an erratic environment can harm your investment.

Average Renovation Costs

Look thoroughly at the potential repair costs so you will be aware whether you can reach your projections. The time it will take for acquiring permits and the local government’s requirements for a permit request will also influence your decision. To draft a detailed financial strategy, you’ll have to understand whether your plans will be required to involve an architect or engineer.

Population Growth

Population data will inform you if there is a growing necessity for homes that you can sell. Flat or decelerating population growth is a sign of a weak market with not a lot of buyers to justify your risk.

Median Population Age

The median citizens’ age can additionally tell you if there are adequate homebuyers in the region. If the median age is equal to that of the typical worker, it’s a positive indication. A high number of such citizens shows a substantial source of home purchasers. The needs of retired people will probably not be a part of your investment project strategy.

Unemployment Rate

You want to see a low unemployment level in your investment city. It should always be lower than the national average. If the community’s unemployment rate is less than the state average, that’s an indication of a preferable economy. If you don’t have a robust employment base, an area can’t provide you with enough home purchasers.

Income Rates

Median household and per capita income rates advise you if you will get enough buyers in that place for your residential properties. Most people who purchase a home need a mortgage loan. Home purchasers’ eligibility to be given a mortgage rests on the level of their income. You can see from the location’s median income if many people in the location can manage to buy your real estate. You also want to have wages that are expanding continually. If you want to increase the purchase price of your homes, you want to be positive that your customers’ salaries are also going up.

Number of New Jobs Created

The number of jobs appearing annually is useful information as you contemplate on investing in a particular area. Residential units are more effortlessly liquidated in an area that has a robust job market. Qualified skilled professionals looking into purchasing a property and deciding to settle opt for relocating to places where they will not be out of work.

Hard Money Loan Rates

Investors who work with renovated real estate frequently utilize hard money funding rather than traditional loans. This enables them to rapidly purchase undervalued properties. Research the best Lewis County hard money lenders and study financiers’ costs.

Someone who needs to understand more about hard money loans can discover what they are as well as how to utilize them by reading our guide titled How Does Hard Money Work?.

Wholesaling is a real estate investment approach that involves locating properties that are desirable to investors and signing a sale and purchase agreement. However you don’t close on the house: once you control the property, you get a real estate investor to take your place for a fee. The property is sold to the real estate investor, not the wholesaler. The real estate wholesaler doesn’t liquidate the property — they sell the rights to purchase one.

The wholesaling form of investing includes the employment of a title insurance company that comprehends wholesale transactions and is informed about and engaged in double close transactions. Locate Lewis County title companies for real estate investors by reviewing our list.

To learn how real estate wholesaling works, read our detailed article Complete Guide to Real Estate Wholesaling as an Investment Strategy. When employing this investment tactic, add your business in our directory of the best property wholesalers in Lewis County WV. That will enable any likely customers to find you and initiate a contact.

Factors to Consider

Median Home Prices

Median home prices are instrumental to locating places where residential properties are being sold in your real estate investors’ purchase price range. Since investors want investment properties that are available for lower than market value, you will have to see lower median prices as an implicit tip on the potential source of properties that you may buy for less than market value.

A quick decrease in the market value of real estate could generate the abrupt appearance of properties with more debt than value that are desired by wholesalers. This investment plan often carries numerous different perks. Nonetheless, be cognizant of the legal liability. Learn about this from our guide Can You Wholesale a Short Sale?. When you’ve decided to attempt wholesaling short sales, be certain to hire someone on the directory of the best short sale law firms in Lewis County WV and the best foreclosure attorneys in Lewis County WV to advise you.

Property Appreciation Rate

Median home value dynamics are also vital. Many real estate investors, such as buy and hold and long-term rental landlords, notably want to find that residential property prices in the community are going up consistently. A declining median home price will show a poor leasing and housing market and will turn off all kinds of real estate investors.

Population Growth

Population growth figures are critical for your potential purchase contract purchasers. When they know the population is growing, they will conclude that new housing is required. This combines both rental and resale real estate. When a population isn’t growing, it doesn’t require more houses and investors will invest elsewhere.

Median Population Age

Real estate investors need to work in a strong housing market where there is a substantial supply of tenants, newbie homebuyers, and upwardly mobile citizens switching to larger homes. In order for this to happen, there has to be a solid workforce of potential tenants and homebuyers. When the median population age is the age of working citizens, it demonstrates a reliable real estate market.

Income Rates

The median household and per capita income should be improving in a strong residential market that investors prefer to participate in. Increases in rent and asking prices must be aided by rising salaries in the market. Real estate investors have to have this if they are to meet their expected returns.

Unemployment Rate

The community’s unemployment numbers will be a crucial factor for any future contract buyer. Tenants in high unemployment regions have a challenging time staying current with rent and some of them will miss payments altogether. Long-term real estate investors will not acquire a house in a market like that. Investors can’t count on tenants moving up into their properties when unemployment rates are high. This can prove to be difficult to reach fix and flip investors to acquire your buying contracts.

Number of New Jobs Created

The frequency of additional jobs being produced in the region completes an investor’s study of a future investment site. Individuals settle in a community that has additional job openings and they require a place to live. Long-term real estate investors, like landlords, and short-term investors which include flippers, are attracted to communities with consistent job production rates.

Average Renovation Costs

Rehab expenses have a large effect on a rehabber’s returns. Short-term investors, like house flippers, will not make a profit if the price and the repair costs equal to a larger sum than the After Repair Value (ARV) of the house. The less you can spend to fix up a home, the more attractive the place is for your future contract buyers.

Investing in mortgage notes (loans) works when the loan can be bought for a lower amount than the face value. The debtor makes subsequent loan payments to the note investor who has become their new lender.

When a mortgage loan is being paid as agreed, it is thought of as a performing loan. They earn you stable passive income. Non-performing notes can be restructured or you could pick up the collateral at a discount through a foreclosure process.

One day, you might have many mortgage notes and require more time to handle them without help. At that point, you might need to use our directory of Lewis County top mortgage loan servicers and reassign your notes as passive investments.

When you determine that this strategy is a good fit for you, include your name in our directory of Lewis County top companies that buy mortgage notes. Being on our list places you in front of lenders who make lucrative investment opportunities accessible to note investors such as yourself.

Factors to consider

Foreclosure Rates

Performing note investors try to find communities with low foreclosure rates. High rates might signal investment possibilities for non-performing loan note investors, but they need to be cautious. The neighborhood should be robust enough so that mortgage note investors can foreclose and get rid of properties if required.

Foreclosure Laws

Successful mortgage note investors are completely aware of their state’s regulations for foreclosure. Are you faced with a Deed of Trust or a mortgage? Lenders might need to obtain the court’s permission to foreclose on real estate. You only have to file a notice and start foreclosure process if you are working with a Deed of Trust.

Mortgage Interest Rates

The mortgage interest rate is indicated in the mortgage notes that are purchased by mortgage note investors. This is an important component in the profits that lenders earn. No matter the type of investor you are, the note’s interest rate will be important to your forecasts.

Conventional lenders price different mortgage loan interest rates in various locations of the US. Private loan rates can be a little higher than conventional interest rates because of the higher risk taken by private lenders.

A note investor should know the private and traditional mortgage loan rates in their regions at any given time.

Demographics

A city’s demographics information assist mortgage note buyers to focus their work and appropriately distribute their assets. It’s critical to know if a sufficient number of residents in the market will continue to have good paying employment and wages in the future.
Performing note investors need homeowners who will pay without delay, creating a stable revenue flow of loan payments.

Investors who seek non-performing mortgage notes can also take advantage of dynamic markets. If these note investors want to foreclose, they’ll need a thriving real estate market in order to sell the collateral property.

Property Values

The more equity that a homebuyer has in their home, the better it is for you as the mortgage note owner. If the investor has to foreclose on a loan with little equity, the foreclosure auction may not even cover the balance invested in the note. Growing property values help increase the equity in the house as the homeowner lessens the amount owed.

Property Taxes

Payments for house taxes are normally sent to the lender along with the loan payment. So the mortgage lender makes sure that the taxes are submitted when due. The mortgage lender will need to compensate if the mortgage payments halt or the investor risks tax liens on the property. If a tax lien is put in place, the lien takes precedence over the your loan.

If a municipality has a history of increasing property tax rates, the total house payments in that area are steadily increasing. Borrowers who are having difficulty handling their loan payments might drop farther behind and eventually default.

Real Estate Market Strength

A location with increasing property values promises good opportunities for any mortgage note buyer. The investors can be confident that, if need be, a foreclosed property can be unloaded for an amount that makes a profit.

A strong market can also be a profitable area for creating mortgage notes. For experienced investors, this is a valuable segment of their business plan.

Some real estate investment businesses are built as a trust termed Real Estate Investment Trusts or REITs. REITs are developed to enable everyday people to buy into properties. Most people these days are capable of investing in a REIT.

Shareholders’ involvement in a REIT is considered passive investing. Investment exposure is spread across a group of real estate. Shares can be unloaded whenever it’s agreeable for the investor. Members in a REIT aren’t able to suggest or select real estate properties for investment. You are confined to the REIT’s portfolio of assets for investment.

Mutual funds owning shares of real estate businesses are called real estate investment funds. The fund does not hold properties — it holds shares in real estate businesses. Investment funds are considered an inexpensive way to combine real estate in your allotment of assets without needless exposure. Fund shareholders might not get usual disbursements the way that REIT participants do. The value of a fund to an investor is the anticipated increase of the worth of the fund’s shares.

You are able to select a fund that focuses on particular segments of the real estate industry but not particular markets for individual property investment. You must depend on the fund’s managers to choose which locations and real estate properties are picked for investment.