Ultimate Morgan County Real Estate Investing Guide for 2024

The term BRRRR is an illustration of a long-term investment plan — Buy, Rehab, Rent, Refinance, Repeat. If you want to expand your investments, the BRRRR is a proven strategy to follow. It is essential that you are qualified to receive a “cash-out” refinance for the plan to be successful.

The After Repair Value (ARV) of the property has to total more than the combined buying and rehab expenses. Then you borrow a cash-out mortgage refinance loan that is calculated on the higher market value, and you take out the difference. This capital is placed into a different property, and so on. You buy more and more properties and repeatedly grow your lease revenues.

When an investor owns a significant collection of investment properties, it seems smart to hire a property manager and designate a passive income source. Find Morgan County property management companies when you look through our list of professionals.

Factors to Consider

Population Growth

The rise or fall of the population can indicate whether that community is appealing to landlords. If you discover good population growth, you can be sure that the market is pulling potential tenants to it. Relocating companies are attracted to rising markets providing reliable jobs to households who move there. This equals reliable tenants, greater rental income, and more likely buyers when you need to sell the rental.

Property Taxes

Real estate taxes, regular upkeep spendings, and insurance directly impact your revenue. Investment assets situated in excessive property tax cities will have less desirable profits. If property tax rates are excessive in a given community, you probably need to look elsewhere.

Price to Rent Ratio

The price to rent ratio (p/r) is an illustration of how high of a rent can be collected in comparison to the market worth of the property. If median property values are strong and median rents are low — a high p/r — it will take more time for an investment to repay your costs and attain profitability. You need to see a lower p/r to be confident that you can price your rents high enough to reach good returns.

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. If rental rates are going down, you can scratch that city from consideration.

Median Population Age

Median population age in a reliable long-term investment environment must show the typical worker’s age. If people are moving into the city, the median age will not have a challenge remaining in the range of the labor force. A high median age shows that the current population is retiring with no replacement by younger people relocating in. A thriving investing environment can’t be supported by retiring workers.

Employment Base Diversity

A diversified employment base is something a smart long-term rental property investor will hunt for. When the city’s working individuals, who are your tenants, are employed by a diversified combination of employers, you can’t lose all of your renters at the same time (together with your property’s value), if a significant employer in the location goes bankrupt.

Unemployment Rate

High unemployment leads to fewer renters and an unsteady housing market. Historically strong businesses lose clients when other businesses retrench workers. This can generate increased layoffs or fewer work hours in the community. Even tenants who have jobs may find it a burden to keep up with their rent.

Income Rates

Median household and per capita income information is a useful indicator to help you find the places where the renters you want are located. Existing salary statistics will reveal to you if wage growth will enable you to mark up rental charges to achieve your investment return expectations.

Number of New Jobs Created

The more jobs are constantly being provided in an area, the more consistent your tenant supply will be. An economy that produces jobs also boosts the number of stakeholders in the property market. This enables you to buy more lease real estate and backfill current unoccupied units.

School Ratings

School rankings in the district will have a large influence on the local housing market. Companies that are thinking about relocating want superior schools for their workers. Dependable renters are a consequence of a steady job market. Real estate market values gain with additional workers who are homebuyers. You will not find a dynamically soaring residential real estate market without good schools.

Property Appreciation Rates

Real estate appreciation rates are an indispensable component of your long-term investment strategy. You need to have confidence that your real estate assets will grow in market value until you decide to move them. Inferior or dropping property value in a community under assessment is not acceptable.

Residential units where tenants reside in furnished spaces for less than thirty days are called short-term rentals. Long-term rentals, like apartments, require lower payment a night than short-term ones. These houses could need more constant maintenance and cleaning.

Home sellers standing by to close on a new home, people on vacation, and people traveling for work who are staying in the area for a few days prefer to rent a residential unit short term. House sharing platforms like AirBnB and VRBO have helped many property owners to get in on the short-term rental business. Short-term rentals are thought of as a smart method to jumpstart investing in real estate.

Short-term rentals involve engaging with occupants more repeatedly than long-term rentals. Because of this, owners deal with difficulties repeatedly. Ponder protecting yourself and your portfolio by adding one of property law attorneys in Morgan County WV to your network of professionals.

Factors to Consider

Short-Term Rental Income

You need to find the amount of rental income you are targeting based on your investment analysis. Learning about the average amount of rental fees in the region for short-term rentals will enable you to pick a profitable location to invest.

Median Property Prices

You also need to decide how much you can afford to invest. The median values of real estate will show you whether you can afford to participate in that area. You can adjust your real estate hunt by estimating median market worth in the area’s sub-markets.

Price Per Square Foot

Price per square foot could be confusing when you are comparing different properties. A house with open foyers and high ceilings cannot be contrasted with a traditional-style residential unit with bigger floor space. If you keep this in mind, the price per square foot can give you a general view of real estate prices.

Short-Term Rental Occupancy Rate

A quick check on the community’s short-term rental occupancy rate will tell you if there is an opportunity in the market for more short-term rentals. An area that necessitates new rentals will have a high occupancy rate. When the rental occupancy rates are low, there is not much need in the market and you should explore in another location.

Short-Term Rental Cash-on-Cash Return

A short-term rental’s cash-on-cash return will show you if the investment is a prudent use of your money. Divide the Net Operating Income (NOI) by the amount of cash invested. The result is a percentage. The higher it is, the sooner your investment funds will be recouped and you will start getting profits. When you take a loan for part of the investment amount and use less of your own capital, you will see a higher cash-on-cash return.

Average Short-Term Rental Capitalization (Cap) Rates

One measurement indicates the market value of a property as a revenue-producing asset — average short-term rental capitalization (cap) rate. In general, the less money a unit will cost (or is worth), the higher the cap rate will be. If investment real estate properties in a community have low cap rates, they typically will cost more. Divide your expected Net Operating Income (NOI) by the property’s market worth or purchase price. The answer is the yearly return in a percentage.

Local Attractions

Major festivals and entertainment attractions will attract visitors who want short-term rental houses. People visit specific locations to attend academic and sporting events at colleges and universities, see competitions, support their kids as they compete in kiddie sports, have the time of their lives at annual carnivals, and drop by amusement parks. Must-see vacation sites are located in mountain and coastal points, along rivers, and national or state nature reserves.

To fix and flip a home, you have to buy it for below market worth, complete any required repairs and upgrades, then dispose of it for after-repair market worth. The keys to a profitable fix and flip are to pay a lower price for the investment property than its current market value and to correctly calculate the amount you need to spend to make it sellable.

Analyze the housing market so that you know the exact After Repair Value (ARV). The average number of Days On Market (DOM) for houses listed in the area is important. As a “house flipper”, you will need to sell the renovated real estate without delay in order to avoid upkeep spendings that will reduce your profits.

To help distressed property sellers locate you, list your company in our directories of home cash buyers in Morgan County WV and property investment companies in Morgan County WV.

Additionally, coordinate with Morgan County property bird dogs. Specialists on our list specialize in acquiring desirable investments while they are still under the radar.

Factors to Consider

Median Home Price

The area’s median housing value will help you find a desirable neighborhood for flipping houses. You’re on the lookout for median prices that are low enough to hint on investment opportunities in the area. You have to have cheaper real estate for a profitable deal.

If market information shows a rapid decline in real estate market values, this can highlight the availability of potential short sale real estate. Real estate investors who team with short sale specialists in Morgan County WV get continual notices regarding potential investment properties. Find out how this is done by reviewing our explanation ⁠— How to Buy a House in a Short Sale.

Property Appreciation Rate

The shifts in real estate prices in a region are vital. You have to have a market where property values are steadily and continuously ascending. Property purchase prices in the market need to be going up steadily, not abruptly. You may wind up purchasing high and liquidating low in an unstable market.

Average Renovation Costs

Look carefully at the potential renovation costs so you’ll find out whether you can reach your projections. Other costs, such as clearances, can increase your budget, and time which may also turn into additional disbursement. You want to know whether you will need to hire other specialists, like architects or engineers, so you can be ready for those expenses.

Population Growth

Population increase metrics let you take a look at housing need in the area. Flat or decelerating population growth is a sign of a weak environment with not a lot of buyers to justify your effort.

Median Population Age

The median residents’ age is a straightforward indication of the supply of ideal homebuyers. When the median age is equal to the one of the regular worker, it is a good sign. Individuals in the area’s workforce are the most dependable home buyers. The needs of retirees will probably not be a part of your investment project plans.

Unemployment Rate

When assessing a location for investment, search for low unemployment rates. The unemployment rate in a prospective investment market should be lower than the US average. A positively friendly investment location will have an unemployment rate less than the state’s average. Unemployed individuals cannot purchase your real estate.

Income Rates

Median household and per capita income are a solid indication of the stability of the housing conditions in the region. Most people who acquire a house need a home mortgage loan. Homebuyers’ eligibility to get issued a loan depends on the size of their income. Median income can let you analyze if the standard homebuyer can afford the homes you intend to list. Look for cities where salaries are going up. Construction expenses and home prices rise periodically, and you want to know that your potential purchasers’ wages will also climb up.

Number of New Jobs Created

Understanding how many jobs are generated every year in the region can add to your assurance in a city’s investing environment. More citizens purchase homes when the local economy is generating jobs. Fresh jobs also attract workers arriving to the area from another district, which also revitalizes the local market.

Hard Money Loan Rates

Fix-and-flip real estate investors normally borrow hard money loans in place of traditional financing. Doing this enables them negotiate profitable ventures without holdups. Research Morgan County hard money lenders and look at lenders’ fees.

Someone who wants to learn about hard money loans can find what they are and how to employ them by reviewing our guide titled How to Use Hard Money Lenders.

In real estate wholesaling, you find a property that real estate investors may think is a lucrative investment opportunity and enter into a sale and purchase agreement to purchase the property. An investor then ”purchases” the sale and purchase agreement from you. The property under contract is sold to the real estate investor, not the real estate wholesaler. The real estate wholesaler doesn’t liquidate the property — they sell the contract to buy one.

This method requires employing a title firm that’s knowledgeable about the wholesale purchase and sale agreement assignment procedure and is able and predisposed to manage double close deals. Find Morgan County title services for wholesale investors by reviewing our list.

Our comprehensive guide to wholesaling can be viewed here: Property Wholesaling Explained. While you go about your wholesaling business, insert your name in HouseCashin’s list of Morgan County top investment property wholesalers. This will let your potential investor clients find and reach you.

Factors to Consider

Median Home Prices

Median home prices in the city being considered will quickly show you whether your investors’ preferred real estate are positioned there. Below average median values are a valid indicator that there are plenty of houses that might be purchased for less than market price, which investors need to have.

A fast depreciation in the price of property could generate the sudden appearance of homes with negative equity that are desired by wholesalers. Wholesaling short sale houses often carries a collection of particular perks. Nevertheless, be cognizant of the legal liability. Obtain additional data on how to wholesale a short sale house in our complete guide. When you are ready to start wholesaling, look through Morgan County top short sale attorneys as well as Morgan County top-rated foreclosure law offices directories to discover the right counselor.

Property Appreciation Rate

Median home value trends are also critical. Real estate investors who need to liquidate their properties later, like long-term rental investors, need a region where real estate prices are growing. A dropping median home price will show a poor rental and home-buying market and will turn off all types of real estate investors.

Population Growth

Population growth information is important for your proposed contract purchasers. If they realize the population is multiplying, they will decide that new housing is required. This includes both rental and resale real estate. A location with a dropping population does not attract the real estate investors you need to buy your contracts.

Median Population Age

A strong housing market necessitates residents who start off leasing, then transitioning into homeownership, and then moving up in the residential market. A place with a huge workforce has a consistent supply of renters and purchasers. When the median population age mirrors the age of employed people, it signals a favorable housing market.

Income Rates

The median household and per capita income in a stable real estate investment market have to be improving. Surges in lease and purchase prices have to be sustained by growing wages in the area. That will be important to the real estate investors you are trying to attract.

Unemployment Rate

Investors will pay a lot of attention to the city’s unemployment rate. High unemployment rate causes many tenants to make late rent payments or miss payments altogether. This impacts long-term real estate investors who need to lease their property. High unemployment causes uncertainty that will stop people from buying a house. Short-term investors won’t take a chance on being stuck with a house they cannot liquidate easily.

Number of New Jobs Created

Learning how frequently new employment opportunities are produced in the city can help you determine if the property is located in a stable housing market. Job production implies additional workers who have a need for housing. Whether your purchaser supply consists of long-term or short-term investors, they will be drawn to a community with stable job opening creation.

Average Renovation Costs

An indispensable variable for your client investors, especially house flippers, are rehab expenses in the market. When a short-term investor rehabs a home, they want to be able to sell it for more than the whole expense for the acquisition and the upgrades. Lower average rehab expenses make a community more desirable for your priority customers — flippers and rental property investors.

Note investors purchase a loan from mortgage lenders when they can buy the loan for less than face value. This way, the investor becomes the lender to the initial lender’s borrower.

When a mortgage loan is being paid as agreed, it’s considered a performing note. Performing notes are a stable generator of cash flow. Some note investors look for non-performing loans because when the mortgage note investor can’t successfully restructure the loan, they can always take the collateral at foreclosure for a low amount.

Eventually, you could have a lot of mortgage notes and need more time to service them on your own. In this event, you can enlist one of mortgage loan servicers in Morgan County WV that will essentially convert your investment into passive income.

Should you decide to utilize this plan, append your project to our directory of real estate note buying companies in Morgan County WV. This will make your business more visible to lenders providing lucrative opportunities to note investors like you.

Factors to consider

Foreclosure Rates

Investors searching for stable-performing mortgage loans to purchase will hope to uncover low foreclosure rates in the market. If the foreclosures are frequent, the community could nonetheless be profitable for non-performing note buyers. But foreclosure rates that are high often signal a weak real estate market where unloading a foreclosed home may be hard.

Foreclosure Laws

It is critical for mortgage note investors to know the foreclosure regulations in their state. Are you faced with a Deed of Trust or a mortgage? You might have to receive the court’s approval to foreclose on a home. A Deed of Trust enables you to file a notice and start foreclosure.

Mortgage Interest Rates

Purchased mortgage loan notes contain a negotiated interest rate. That interest rate will significantly impact your returns. Interest rates influence the plans of both sorts of note investors.

Traditional interest rates may be different by as much as a quarter of a percent around the US. Mortgage loans provided by private lenders are priced differently and may be more expensive than traditional mortgages.

Mortgage note investors should always be aware of the present market interest rates, private and traditional, in possible investment markets.

Demographics

A lucrative note investment plan incorporates a study of the area by utilizing demographic data. The location’s population increase, employment rate, job market growth, wage standards, and even its median age contain pertinent information for you.
Performing note investors require homebuyers who will pay on time, creating a consistent revenue source of loan payments.

Note buyers who acquire non-performing mortgage notes can also take advantage of dynamic markets. If non-performing note buyers need to foreclose, they will have to have a thriving real estate market in order to liquidate the repossessed property.

Property Values

Note holders need to find as much home equity in the collateral as possible. When the lender has to foreclose on a mortgage loan without much equity, the sale might not even repay the amount owed. The combined effect of loan payments that lower the mortgage loan balance and yearly property market worth growth increases home equity.

Property Taxes

Usually borrowers pay property taxes through lenders in monthly installments together with their loan payments. That way, the mortgage lender makes sure that the taxes are taken care of when payable. If mortgage loan payments are not current, the lender will have to either pay the property taxes themselves, or they become past due. If a tax lien is put in place, the lien takes precedence over the lender’s loan.

Because property tax escrows are combined with the mortgage loan payment, increasing property taxes mean larger mortgage payments. This makes it tough for financially challenged borrowers to make their payments, so the mortgage loan might become delinquent.

Real Estate Market Strength

A community with increasing property values has good opportunities for any note buyer. They can be assured that, if need be, a repossessed property can be sold at a price that is profitable.

A growing real estate market might also be a profitable place for making mortgage notes. For experienced investors, this is a profitable portion of their investment strategy.

A REIT, or Real Estate Investment Trust, means a firm that makes investments in income-generating assets. REITs were developed to empower everyday investors to buy into real estate. REIT shares are economical to the majority of investors.

Shareholders’ participation in a REIT is passive investment. The exposure that the investors are accepting is spread within a collection of investment properties. Investors are able to sell their REIT shares anytime they need. Investors in a REIT are not able to recommend or submit real estate for investment. The assets that the REIT decides to buy are the assets your capital is used to purchase.

A Real Estate Investment Fund is a mutual fund that possesses stocks of real estate companies. The investment assets are not owned by the fund — they’re held by the firms in which the fund invests. These funds make it easier for a wider variety of investors to invest in real estate properties. Investment funds are not required to distribute dividends like a REIT. The value of a fund to an investor is the expected increase of the value of the fund’s shares.

You may pick a fund that concentrates on a targeted type of real estate you’re familiar with, but you do not get to choose the market of each real estate investment. Your choice as an investor is to pick a fund that you believe in to oversee your real estate investments.