Ultimate Logan County Real Estate Investing Guide for 2024

BRRRR means “Buy, Rehab, Rent, Refinance, Repeat”. BRRRR is a method for consistent expansion. It is critical that you be able to obtain a “cash-out” refinance loan for the strategy to work.

You enhance the worth of the property above the amount you spent buying and renovating the property. The house is refinanced using the ARV and the difference, or equity, is given to you in cash. This money is reinvested into the next asset, and so on. You add growing assets to the portfolio and lease income to your cash flow.

When your investment property portfolio is large enough, you might outsource its oversight and generate passive cash flow. Locate Logan County property management agencies when you go through our list of professionals.

Factors to Consider

Population Growth

The expansion or decline of a community’s population is a valuable barometer of the community’s long-term appeal for rental property investors. An increasing population often demonstrates busy relocation which translates to new tenants. Moving businesses are drawn to rising areas giving reliable jobs to households who relocate there. A growing population creates a certain base of tenants who will stay current with rent increases, and a strong property seller’s market if you decide to liquidate any investment properties.

Property Taxes

Property taxes, ongoing maintenance expenses, and insurance directly affect your profitability. Unreasonable expenses in these areas threaten your investment’s bottom line. Excessive property tax rates may predict an unstable region where costs can continue to increase and should be treated as a red flag.

Price to Rent Ratio

The price to rent ratio (p/r) is a comparison of median property values and median rental rates that will signal how much rent the market can tolerate. The amount of rent that you can demand in a location will impact the price you are willing to pay depending on how long it will take to recoup those costs. A high p/r tells you that you can collect modest rent in that community, a lower ratio signals you that you can demand more.

Median Gross Rents

Median gross rents are a clear indicator of the stability of a lease market. Median rents should be expanding to warrant your investment. Declining rents are an alert to long-term investor landlords.

Median Population Age

Median population age in a strong long-term investment market must reflect the usual worker’s age. You will find this to be factual in cities where workers are migrating. A high median age means that the existing population is aging out with no replacement by younger people migrating in. A dynamic real estate market cannot be sustained by aged, non-working residents.

Employment Base Diversity

A varied employment base is what a wise long-term rental property investor will search for. If there are only a couple dominant hiring companies, and either of such moves or closes down, it will lead you to lose tenants and your asset market worth to plunge.

Unemployment Rate

High unemployment means a lower number of tenants and an unsteady housing market. Jobless individuals stop being clients of yours and of other businesses, which produces a domino effect throughout the city. The still employed workers could find their own paychecks reduced. This may increase the instances of late rents and renter defaults.

Income Rates

Median household and per capita income levels show you if an adequate amount of ideal renters live in that city. Improving salaries also inform you that rents can be raised over the life of the investment property.

Number of New Jobs Created

An expanding job market results in a constant flow of tenants. The individuals who take the new jobs will have to have a place to live. Your plan of renting and acquiring more rentals needs an economy that will produce enough jobs.

School Ratings

School reputation in the community will have a strong impact on the local real estate market. Employers that are considering relocating want good schools for their employees. Dependable tenants are a by-product of a robust job market. Homeowners who move to the area have a good effect on real estate market worth. You will not find a vibrantly expanding residential real estate market without good schools.

Property Appreciation Rates

The essence of a long-term investment plan is to hold the asset. You have to make sure that your property assets will rise in market value until you want to liquidate them. You do not need to spend any time surveying regions that have substandard property appreciation rates.

A furnished property where renters live for less than 30 days is regarded as a short-term rental. Long-term rental units, like apartments, impose lower rent a night than short-term rentals. These homes could need more frequent upkeep and tidying.

House sellers standing by to close on a new residence, vacationers, and business travelers who are stopping over in the city for about week prefer renting a residential unit short term. Regular property owners can rent their houses or condominiums on a short-term basis through sites like AirBnB and VRBO. A convenient approach to get started on real estate investing is to rent a condo or house you currently keep for short terms.

Short-term rental units require dealing with occupants more repeatedly than long-term rentals. This dictates that property owners handle disagreements more regularly. You might want to protect your legal bases by working with one of the best Logan County investor friendly real estate attorneys.

Factors to Consider

Short-Term Rental Income

You must define the amount of rental income you are aiming for according to your investment strategy. An area’s short-term rental income rates will quickly reveal to you when you can anticipate to achieve your projected income levels.

Median Property Prices

Carefully calculate the budget that you can spend on new investment assets. Scout for markets where the purchase price you need matches up with the current median property prices. You can also make use of median values in targeted areas within the market to choose cities for investment.

Price Per Square Foot

Price per sq ft can be affected even by the style and floor plan of residential units. A building with open foyers and high ceilings can’t be contrasted with a traditional-style property with bigger floor space. You can use the price per square foot criterion to obtain a good general picture of property values.

Short-Term Rental Occupancy Rate

A look at the location’s short-term rental occupancy levels will inform you if there is an opportunity in the district for additional short-term rental properties. If nearly all of the rentals have few vacancies, that community needs new rental space. When the rental occupancy rates are low, there is not much need in the market and you should search in a different place.

Short-Term Rental Cash-on-Cash Return

To know whether you should put your cash in a certain rental unit or city, calculate the cash-on-cash return. Take your expected Net Operating Income (NOI) and divide it by the cash amount you’re ready to invest. The percentage you get is your cash-on-cash return. The higher it is, the quicker your investment funds will be recouped and you will begin gaining profits. Lender-funded investments will show higher cash-on-cash returns as you are using less of your own funds.

Average Short-Term Rental Capitalization (Cap) Rates

This benchmark compares rental property value to its per-annum return. As a general rule, the less an investment property costs (or is worth), the higher the cap rate will be. When investment properties in a market have low cap rates, they usually will cost too much. Divide your estimated Net Operating Income (NOI) by the investment property’s market value or asking price. The percentage you will receive is the investment property’s cap rate.

Local Attractions

Short-term rental units are preferred in areas where visitors are attracted by events and entertainment spots. This includes major sporting events, kiddie sports contests, colleges and universities, big auditoriums and arenas, festivals, and amusement parks. Natural scenic attractions like mountainous areas, rivers, coastal areas, and state and national nature reserves will also draw prospective renters.

To fix and flip a property, you should pay less than market price, perform any needed repairs and updates, then dispose of the asset for after-repair market price. Your assessment of renovation expenses has to be correct, and you have to be able to buy the home below market worth.

Assess the values so that you are aware of the exact After Repair Value (ARV). Choose a market with a low average Days On Market (DOM) indicator. As a ”rehabber”, you’ll have to sell the repaired property immediately in order to stay away from maintenance expenses that will lower your returns.

In order that homeowners who have to liquidate their property can readily discover you, promote your status by utilizing our directory of companies that buy houses for cash in Logan County WV along with the best real estate investment firms in Logan County WV.

Also, coordinate with Logan County real estate bird dogs. Experts on our list focus on securing little-known investment opportunities while they are still unlisted.

Factors to Consider

Median Home Price

Median property price data is a vital benchmark for estimating a potential investment area. You’re seeking for median prices that are modest enough to indicate investment opportunities in the city. This is a critical component of a profit-making rehab and resale project.

If your investigation entails a rapid drop in housing market worth, it might be a signal that you will find real property that fits the short sale criteria. You will receive notifications concerning these opportunities by joining with short sale negotiators in Logan County WV. Learn how this works by studying our explanation ⁠— How to Buy a Short Sale House Quickly.

Property Appreciation Rate

Dynamics is the direction that median home values are going. Predictable growth in median values shows a vibrant investment market. Unpredictable market worth shifts aren’t desirable, even if it’s a substantial and sudden surge. When you’re acquiring and liquidating swiftly, an uncertain market can harm your investment.

Average Renovation Costs

Look thoroughly at the possible rehab costs so you’ll find out if you can achieve your targets. The way that the local government processes your application will affect your investment as well. To make an on-target budget, you will need to understand whether your construction plans will be required to use an architect or engineer.

Population Growth

Population data will tell you whether there is a growing necessity for houses that you can supply. If there are purchasers for your fixed up homes, the data will indicate a robust population growth.

Median Population Age

The median residents’ age will additionally show you if there are potential home purchasers in the location. The median age in the community needs to be the one of the regular worker. People in the regional workforce are the most steady real estate purchasers. The demands of retired people will most likely not fit into your investment project plans.

Unemployment Rate

When you run across an area with a low unemployment rate, it is a solid indication of profitable investment prospects. An unemployment rate that is lower than the US median is preferred. When it’s also less than the state average, it’s even better. If they want to buy your improved houses, your clients need to have a job, and their clients too.

Income Rates

Median household and per capita income numbers show you whether you will get adequate home purchasers in that place for your residential properties. The majority of people who buy a home need a mortgage loan. Homebuyers’ capacity to be given financing hinges on the level of their wages. The median income numbers will show you if the community is good for your investment efforts. In particular, income increase is vital if you need to grow your business. When you want to augment the price of your residential properties, you have to be positive that your customers’ income is also rising.

Number of New Jobs Created

The number of jobs created on a steady basis reflects if income and population growth are viable. A growing job market means that a higher number of potential homeowners are confident in investing in a house there. Competent skilled professionals taking into consideration purchasing real estate and settling choose relocating to cities where they won’t be out of work.

Hard Money Loan Rates

Those who purchase, renovate, and liquidate investment real estate prefer to engage hard money and not conventional real estate loans. Hard money funds allow these purchasers to move forward on hot investment opportunities right away. Locate top-rated hard money lenders in Logan County WV so you may compare their fees.

An investor who needs to know about hard money funding options can discover what they are and the way to employ them by reviewing our article titled How Does Hard Money Work?.

Wholesaling is a real estate investment plan that requires locating houses that are interesting to real estate investors and putting them under a sale and purchase agreement. When a real estate investor who wants the property is found, the contract is sold to the buyer for a fee. The owner sells the property to the real estate investor not the wholesaler. The wholesaler doesn’t liquidate the residential property — they sell the rights to buy it.

This method involves employing a title firm that’s experienced in the wholesale purchase and sale agreement assignment procedure and is qualified and willing to coordinate double close transactions. Find title companies for real estate investors in Logan County WV in our directory.

Discover more about the way to wholesale property from our definitive guide — Wholesale Real Estate Investing 101 for Beginners. When you opt for wholesaling, include your investment project in our directory of the best investment property wholesalers in Logan County WV. This will let your potential investor purchasers locate and contact you.

Factors to Consider

Median Home Prices

Median home values in the region being assessed will immediately tell you if your real estate investors’ preferred real estate are located there. As real estate investors prefer properties that are on sale for lower than market value, you will need to see below-than-average median prices as an indirect tip on the potential availability of houses that you may acquire for less than market price.

A quick decline in housing prices may lead to a sizeable number of ‘underwater’ properties that short sale investors hunt for. Short sale wholesalers frequently gain benefits from this method. However, it also produces a legal risk. Find out about this from our in-depth blog post Can You Wholesale a Short Sale House?. Once you determine to give it a go, make certain you have one of short sale real estate attorneys in Logan County WV and foreclosure law offices in Logan County WV to confer with.

Property Appreciation Rate

Property appreciation rate enhances the median price stats. Some real estate investors, including buy and hold and long-term rental landlords, notably need to find that home prices in the area are growing consistently. A shrinking median home price will illustrate a vulnerable leasing and home-buying market and will eliminate all kinds of real estate investors.

Population Growth

Population growth stats are an important indicator that your future investors will be familiar with. If the community is multiplying, additional residential units are needed. Investors realize that this will include both leasing and purchased housing. A location that has a shrinking population will not interest the investors you want to buy your purchase contracts.

Median Population Age

Real estate investors want to be a part of a reliable property market where there is a sufficient supply of renters, newbie homebuyers, and upwardly mobile citizens switching to more expensive residences. For this to happen, there has to be a reliable workforce of potential tenants and homebuyers. If the median population age is equivalent to the age of wage-earning residents, it indicates a favorable residential market.

Income Rates

The median household and per capita income demonstrate constant improvement over time in areas that are good for real estate investment. Income hike shows a place that can deal with lease rate and housing purchase price increases. Investors stay away from markets with weak population income growth statistics.

Unemployment Rate

Investors whom you contact to close your contracts will consider unemployment statistics to be a crucial bit of insight. Renters in high unemployment areas have a hard time making timely rent payments and a lot of them will skip rent payments completely. This hurts long-term real estate investors who need to rent their residential property. Renters cannot move up to homeownership and existing owners can’t liquidate their property and shift up to a larger house. Short-term investors will not risk getting pinned down with a property they cannot resell immediately.

Number of New Jobs Created

The frequency of new jobs being generated in the region completes a real estate investor’s assessment of a potential investment spot. Job formation signifies additional employees who require housing. Long-term real estate investors, such as landlords, and short-term investors that include rehabbers, are attracted to cities with consistent job creation rates.

Average Renovation Costs

An influential factor for your client investors, particularly house flippers, are rehabilitation costs in the city. When a short-term investor flips a home, they need to be prepared to liquidate it for a higher price than the entire expense for the acquisition and the rehabilitation. Below average remodeling expenses make a place more profitable for your main customers — rehabbers and other real estate investors.

Note investing professionals purchase debt from lenders when the investor can buy the loan for a lower price than face value. The debtor makes future mortgage payments to the investor who is now their current lender.

Performing loans mean loans where the homeowner is always current on their payments. They give you stable passive income. Some mortgage investors like non-performing notes because if they can’t successfully rework the loan, they can always purchase the collateral property at foreclosure for a below market price.

One day, you could grow a number of mortgage note investments and not have the time to service them without assistance. At that juncture, you may need to utilize our list of Logan County top third party mortgage servicers and redesignate your notes as passive investments.

Should you choose to use this plan, affix your project to our list of real estate note buyers in Logan County WV. Showing up on our list places you in front of lenders who make profitable investment possibilities accessible to note buyers such as yourself.

Factors to consider

Foreclosure Rates

Investors searching for current mortgage loans to acquire will hope to see low foreclosure rates in the community. High rates could signal investment possibilities for non-performing mortgage note investors, however they have to be cautious. The locale needs to be active enough so that investors can complete foreclosure and unload properties if required.

Foreclosure Laws

Investors want to understand their state’s regulations regarding foreclosure prior to pursuing this strategy. They’ll know if their state requires mortgages or Deeds of Trust. You might need to get the court’s okay to foreclose on a mortgage note’s collateral. A Deed of Trust allows you to file a notice and start foreclosure.

Mortgage Interest Rates

Acquired mortgage loan notes contain an agreed interest rate. Your investment profits will be affected by the interest rate. No matter which kind of mortgage note investor you are, the loan note’s interest rate will be crucial to your calculations.

Conventional lenders price dissimilar interest rates in various regions of the country. The stronger risk taken on by private lenders is reflected in bigger mortgage loan interest rates for their loans in comparison with traditional mortgage loans.

Experienced note investors routinely search the rates in their market offered by private and traditional lenders.

Demographics

A region’s demographics data help note buyers to streamline their efforts and effectively distribute their assets. Investors can discover a lot by looking at the extent of the populace, how many residents are employed, the amount they make, and how old the people are.
A young expanding region with a vibrant job market can provide a reliable revenue flow for long-term investors searching for performing notes.

Non-performing mortgage note investors are looking at comparable factors for various reasons. If non-performing investors want to foreclose, they will require a thriving real estate market to liquidate the defaulted property.

Property Values

Mortgage lenders like to find as much home equity in the collateral property as possible. If the investor has to foreclose on a mortgage loan without much equity, the foreclosure sale may not even pay back the balance invested in the note. As mortgage loan payments reduce the balance owed, and the value of the property increases, the borrower’s equity grows.

Property Taxes

Many homeowners pay real estate taxes through mortgage lenders in monthly installments while sending their loan payments. The mortgage lender pays the taxes to the Government to make certain the taxes are paid promptly. If the borrower stops paying, unless the mortgage lender pays the property taxes, they won’t be paid on time. Tax liens leapfrog over any other liens.

If a community has a history of growing property tax rates, the combined home payments in that region are regularly growing. This makes it difficult for financially challenged borrowers to make their payments, so the mortgage loan might become past due.

Real Estate Market Strength

A community with increasing property values has excellent opportunities for any mortgage note buyer. The investors can be assured that, when necessary, a foreclosed property can be unloaded at a price that is profitable.

Note investors also have a chance to make mortgage loans directly to borrowers in reliable real estate communities. It’s an additional stage of a mortgage note buyer’s career.

A trust that owns income-generating real estate and that sells shares to people is a REIT — Real Estate Investment Trust. REITs were developed to permit ordinary people to invest in real estate. Many investors today are capable of investing in a REIT.

Shareholders’ investment in a REIT is passive investing. The risk that the investors are taking is diversified among a group of investment assets. Shares in a REIT may be sold when it’s beneficial for you. Members in a REIT aren’t able to advise or submit assets for investment. Their investment is confined to the investment properties selected by the REIT.

Mutual funds that contain shares of real estate companies are referred to as real estate investment funds. Any actual property is owned by the real estate firms rather than the fund. Investment funds are considered an inexpensive way to incorporate real estate properties in your allotment of assets without avoidable liability. Real estate investment funds aren’t obligated to pay dividends unlike a REIT. The worth of a fund to someone is the anticipated appreciation of the worth of its shares.

You can locate a fund that focuses on a distinct kind of real estate company, like commercial, but you can’t suggest the fund’s investment assets or markets. As passive investors, fund participants are content to permit the directors of the fund handle all investment decisions.