Ultimate Oakwood Real Estate Investing Guide for 2024

BRRRR stands for “Buy, Rehab, Rent, Refinance, Repeat”. This is a way to expand your investment assets not just acquire one asset. This plan hinges on your capability to take cash out when you refinance.

When you have concluded repairing the investment property, its value should be more than your complete purchase and fix-up costs. The rental is refinanced based on the ARV and the balance, or equity, comes to you in cash. This money is put into one more investment property, and so on. You add growing assets to the balance sheet and lease revenue to your cash flow.

If an investor holds a large collection of investment properties, it is wise to employ a property manager and create a passive income stream. Locate one of the best investment property management firms in Oakwood GA with the help of our exhaustive directory.

Factors to Consider

Population Growth

Population growth or fall shows you if you can depend on strong results from long-term real estate investments. If the population increase in a city is high, then new renters are obviously relocating into the area. The location is attractive to businesses and working adults to move, work, and create families. Rising populations maintain a reliable tenant mix that can keep up with rent growth and home purchasers who help keep your investment asset prices high.

Property Taxes

Property taxes, upkeep, and insurance expenses are examined by long-term lease investors for forecasting expenses to assess if and how the plan will pay off. Steep property taxes will hurt a property investor’s income. Locations with high property tax rates aren’t considered a reliable environment for short- or long-term investment and should be avoided.

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 high of a rent the market can allow. If median home prices are strong and median rents are weak — a high p/r, it will take more time for an investment to recoup your costs and reach good returns. A large p/r tells you that you can collect lower rent in that market, a low one says that you can charge more.

Median Gross Rents

Median gross rents are an accurate yardstick of the desirability of a rental market under discussion. Median rents must be increasing to validate your investment. You will not be able to realize your investment goals in an area where median gross rental rates are dropping.

Median Population Age

Median population age in a strong long-term investment market should mirror the normal worker’s age. If people are resettling into the region, the median age will have no challenge staying in the range of the workforce. If you find a high median age, your supply of tenants is shrinking. This isn’t good for the future economy of that area.

Employment Base Diversity

A diversified employment base is something a smart long-term rental property investor will search for. If the residents are concentrated in only several dominant companies, even a minor disruption in their operations might cause you to lose a great deal of renters and expand your exposure considerably.

Unemployment Rate

It’s a challenge to achieve a sound rental market when there are many unemployed residents in it. Non-working individuals cannot purchase goods or services. This can generate more layoffs or fewer work hours in the community. Even people who have jobs will find it difficult to pay rent on time.

Income Rates

Median household and per capita income data is a beneficial indicator to help you find the regions where the renters you are looking for are living. Rising salaries also show you that rental payments can be increased throughout the life of the asset.

Number of New Jobs Created

A growing job market produces a regular stream of renters. A larger amount of jobs equal new tenants. This allows you to purchase additional rental properties and replenish current unoccupied units.

School Ratings

School ratings in the area will have a significant effect on the local property market. When a business looks at a city for possible expansion, they keep in mind that good education is a prerequisite for their workforce. Good tenants are the result of a steady job market. Recent arrivals who need a house keep property prices high. Superior schools are a key requirement for a reliable property investment market.

Property Appreciation Rates

Property appreciation rates are an indispensable component of your long-term investment approach. You need to have confidence that your assets will rise in market price until you need to dispose of them. Small or decreasing property appreciation rates will remove a city from your choices.

A short-term rental is a furnished apartment or house where a renter resides for less than 30 days. Short-term rental landlords charge more rent per night than in long-term rental properties. Short-term rental apartments may require more constant care and cleaning.

Typical short-term tenants are tourists, home sellers who are in-between homes, and people traveling on business who need a more homey place than a hotel room. House sharing platforms like AirBnB and VRBO have opened doors to a lot of homeowners to take part in the short-term rental industry. A simple method to get into real estate investing is to rent real estate you already keep for short terms.

The short-term rental housing business includes interaction with occupants more often in comparison with yearly lease units. That determines that property owners handle disputes more often. You may need to defend your legal bases by hiring one of the best Oakwood investor friendly real estate lawyers.

Factors to Consider

Short-Term Rental Income

You have to determine the level of rental revenue you are looking for according to your investment budget. Learning about the standard amount of rent being charged in the area for short-term rentals will allow you to choose a profitable location to invest.

Median Property Prices

When purchasing property for short-term rentals, you must know the amount you can pay. To check if a city has possibilities for investment, examine the median property prices. You can customize your market search by looking at the median market worth in particular sub-markets.

Price Per Square Foot

Price per square foot can be influenced even by the design and floor plan of residential properties. A home with open foyers and vaulted ceilings can’t be contrasted with a traditional-style property with greater floor space. You can use this criterion to get a good overall picture of real estate values.

Short-Term Rental Occupancy Rate

A quick look at the location’s short-term rental occupancy rate will inform you if there is a need in the region for additional short-term rental properties. A region that necessitates more rental properties will have a high occupancy level. Low occupancy rates indicate that there are more than too many short-term rental properties in that area.

Short-Term Rental Cash-on-Cash Return

Cash-on-cash return is a way to calculate the profitability of an investment. You can compute the cash-on-cash return by taking your Net Operating Income (NOI) and dividing it by your cash investment. The resulting percentage is your cash-on-cash return. High cash-on-cash return means that you will get back your money faster and the investment will earn more profit. If you take a loan for part of the investment amount and use less of your cash, you will receive a higher cash-on-cash return.

Average Short-Term Rental Capitalization (Cap) Rates

One metric indicates the value of real estate as a return-yielding asset — average short-term rental capitalization (cap) rate. Generally, the less money a property costs (or is worth), the higher the cap rate will be. Low cap rates reflect higher-priced real estate. You can calculate the cap rate for possible investment real estate by dividing the Net Operating Income (NOI) by the Fair Market Value or purchase price of the investment property. The percentage you will receive is the investment property’s cap rate.

Local Attractions

Short-term renters are often travellers who visit a community to enjoy a recurring special event or visit unique locations. People go to specific locations to attend academic and sporting events at colleges and universities, see professional sports, support their kids as they compete in fun events, have the time of their lives at annual fairs, and go to adventure parks. At certain occasions, places with outside activities in mountainous areas, oceanside locations, or alongside rivers and lakes will bring in crowds of tourists who want short-term housing.

When a real estate investor acquires a property under market value, renovates it and makes it more valuable, and then disposes of the property for a return, they are referred to as a fix and flip investor. To get profit, the investor needs to pay less than the market price for the house and know how much it will take to renovate it.

You also have to understand the housing market where the house is situated. The average number of Days On Market (DOM) for properties listed in the area is vital. To effectively “flip” a property, you must resell the renovated home before you are required to spend cash maintaining it.

In order that property owners who have to unload their house can easily discover you, highlight your status by utilizing our directory of the best all cash home buyers in Oakwood GA along with top real estate investors in Oakwood GA.

Also, coordinate with Oakwood bird dogs for real estate investors. These professionals specialize in rapidly finding good investment prospects before they hit the market.

Factors to Consider

Median Home Price

When you hunt for a promising area for real estate flipping, examine the median housing price in the community. Modest median home values are an indicator that there may be an inventory of real estate that can be purchased for lower than market value. This is an essential component of a lucrative rehab and resale project.

If you detect a fast weakening in real estate market values, this may signal that there are possibly houses in the neighborhood that will work for a short sale. You’ll learn about possible opportunities when you join up with Oakwood short sale processing companies. Uncover more regarding this kind of investment by reading our guide How to Buy a House as a Short Sale.

Property Appreciation Rate

Are home values in the area moving up, or going down? You need a region where home values are regularly and continuously moving up. Housing purchase prices in the market need to be growing consistently, not abruptly. Buying at an inconvenient time in an unstable market condition can be disastrous.

Average Renovation Costs

A comprehensive study of the market’s construction costs will make a substantial influence on your area selection. The time it will require for acquiring permits and the municipality’s regulations for a permit request will also influence your plans. You want to know if you will need to hire other experts, like architects or engineers, so you can be ready for those expenses.

Population Growth

Population data will tell you if there is a growing need for houses that you can supply. Flat or negative population growth is an indicator of a feeble market with not enough buyers to justify your risk.

Median Population Age

The median population age can additionally tell you if there are potential homebuyers in the region. If the median age is equal to the one of the usual worker, it’s a good indication. Individuals in the area’s workforce are the most reliable home purchasers. Aging people are getting ready to downsize, or move into age-restricted or retiree neighborhoods.

Unemployment Rate

You want to see a low unemployment rate in your investment community. An unemployment rate that is less than the country’s median is good. If the area’s unemployment rate is less than the state average, that is a sign of a desirable economy. If you don’t have a dynamic employment environment, a community can’t provide you with abundant home purchasers.

Income Rates

Median household and per capita income rates tell you if you will get qualified home buyers in that market for your homes. Most individuals who purchase a home need a mortgage loan. To be approved for a home loan, a person can’t be using for a house payment more than a particular percentage of their income. The median income indicators show you if the location is ideal for your investment efforts. Look for places where wages are increasing. When you want to augment the asking price of your residential properties, you want to be sure that your clients’ wages are also going up.

Number of New Jobs Created

The number of employment positions created on a steady basis shows if wage and population growth are viable. More residents purchase houses if their area’s economy is generating jobs. New jobs also lure people coming to the area from other districts, which additionally strengthens the real estate market.

Hard Money Loan Rates

Fix-and-flip investors normally employ hard money loans instead of traditional financing. Hard money loans enable these investors to pull the trigger on pressing investment projects right away. Review Oakwood hard money loan companies and analyze financiers’ costs.

Those who aren’t knowledgeable regarding hard money financing can learn what they should learn with our detailed explanation for newbies — What Is Private Money?.

As a real estate wholesaler, you sign a contract to buy a property that some other investors will want. An investor then “buys” the purchase contract from you. The investor then settles the transaction. You’re selling the rights to buy the property, not the house itself.

Wholesaling depends on the participation of a title insurance company that’s comfortable with assignment of purchase contracts and comprehends how to deal with a double closing. Discover investor friendly title companies in Oakwood GA in our directory.

To understand how wholesaling works, study our detailed guide Complete Guide to Real Estate Wholesaling as an Investment Strategy. As you go with wholesaling, add your investment company in our directory of the best wholesale real estate investors in Oakwood GA. That way your potential audience will see your location and reach out to you.

Factors to Consider

Median Home Prices

Median home prices in the region will inform you if your ideal purchase price range is viable in that location. Low median values are a good indication that there are enough houses that can be acquired for lower than market price, which investors need to have.

Rapid deterioration in real estate values might lead to a lot of houses with no equity that appeal to short sale investors. This investment plan frequently carries numerous particular advantages. Nevertheless, there could be challenges as well. Learn about this from our extensive explanation Can You Wholesale a Short Sale House?. Once you’ve determined to attempt wholesaling these properties, be certain to engage someone on the list of the best short sale law firms in Oakwood GA and the best mortgage foreclosure attorneys in Oakwood GA to assist you.

Property Appreciation Rate

Median home value fluctuations clearly illustrate the home value picture. Investors who need to liquidate their properties later on, such as long-term rental landlords, want a location where residential property market values are going up. Both long- and short-term investors will ignore a city where residential market values are depreciating.

Population Growth

Population growth data is a contributing factor that your future real estate investors will be knowledgeable in. When they realize the population is growing, they will conclude that new housing units are needed. There are many people who rent and additional clients who buy houses. If a place is losing people, it does not necessitate new housing and real estate investors will not look there.

Median Population Age

A vibrant housing market needs people who start off leasing, then transitioning into homebuyers, and then moving up in the residential market. A location with a large workforce has a constant pool of tenants and buyers. When the median population age mirrors the age of employed adults, it signals a dynamic residential market.

Income Rates

The median household and per capita income display steady growth over time in cities that are favorable for investment. If tenants’ and homeowners’ incomes are improving, they can manage surging lease rates and home purchase prices. That will be important to the property investors you are looking to draw.

Unemployment Rate

Investors will thoroughly estimate the community’s unemployment rate. Delayed rent payments and default rates are worse in regions with high unemployment. Long-term investors won’t purchase a property in an area like this. High unemployment creates concerns that will keep people from buying a house. This makes it challenging to locate fix and flip real estate investors to buy your buying contracts.

Number of New Jobs Created

Knowing how frequently fresh employment opportunities appear in the area can help you see if the property is positioned in a stable housing market. Job production suggests added workers who require housing. Employment generation is helpful for both short-term and long-term real estate investors whom you rely on to take on your wholesale real estate.

Average Renovation Costs

Repair spendings will matter to most real estate investors, as they normally purchase cheap distressed houses to fix. When a short-term investor fixes and flips a building, they want to be able to sell it for a higher price than the combined cost of the purchase and the upgrades. Give priority status to lower average renovation costs.

Note investment professionals purchase debt from mortgage lenders when they can buy the note below the outstanding debt amount. The client makes remaining mortgage payments to the note investor who is now their new mortgage lender.

Performing notes mean mortgage loans where the homeowner is consistently current on their loan payments. Performing notes bring repeating income for investors. Non-performing mortgage notes can be restructured or you may pick up the collateral for less than face value by completing a foreclosure procedure.

One day, you might have multiple mortgage notes and necessitate more time to handle them on your own. At that stage, you might want to use our list of Oakwood top home loan servicers and redesignate your notes as passive investments.

If you determine to employ this strategy, affix your project to our list of real estate note buyers in Oakwood GA. Joining will help you become more noticeable to lenders providing desirable opportunities to note investors like you.

Factors to Consider

Foreclosure Rates

Low foreclosure rates are a signal that the market has investment possibilities for performing note buyers. Non-performing loan investors can cautiously make use of locations with high foreclosure rates as well. If high foreclosure rates are causing a weak real estate environment, it could be tough to get rid of the collateral property if you seize it through foreclosure.

Foreclosure Laws

Mortgage note investors need to understand the state’s regulations concerning foreclosure before pursuing this strategy. They’ll know if their law requires mortgages or Deeds of Trust. You might have to receive the court’s approval to foreclose on a house. A Deed of Trust enables you to file a public notice and proceed to foreclosure.

Mortgage Interest Rates

Note investors acquire the interest rate of the mortgage loan notes that they obtain. Your investment profits will be influenced by the interest rate. Mortgage interest rates are significant to both performing and non-performing mortgage note investors.

Conventional lenders price dissimilar mortgage loan interest rates in various parts of the country. Private loan rates can be moderately more than conventional interest rates due to the higher risk accepted by private lenders.

Successful investors routinely search the rates in their market set by private and traditional lenders.

Demographics

A community’s demographics statistics help mortgage note investors to focus their work and properly distribute their assets. Mortgage note investors can discover a great deal by looking at the extent of the populace, how many residents have jobs, how much they make, and how old the citizens are.
Performing note buyers want customers who will pay on time, developing a repeating revenue stream of loan payments.

Mortgage note investors who buy non-performing mortgage notes can also take advantage of vibrant markets. A strong regional economy is required if investors are to find buyers for properties on which they have foreclosed.

Property Values

Lenders like to see as much equity in the collateral as possible. When the value is not much more than the mortgage loan amount, and the lender needs to foreclose, the house might not realize enough to payoff the loan. Rising property values help improve the equity in the property as the homeowner pays down the amount owed.

Property Taxes

Most borrowers pay real estate taxes via lenders in monthly portions while sending their mortgage loan payments. The lender pays the property taxes to the Government to ensure the taxes are submitted on time. If mortgage loan payments aren’t being made, the mortgage lender will have to either pay the taxes themselves, or the property taxes become delinquent. If taxes are past due, the municipality’s lien jumps over all other liens to the front of the line and is taken care of first.

If property taxes keep increasing, the customer’s loan payments also keep growing. Overdue customers might not have the ability to keep up with rising payments and could stop making payments altogether.

Real Estate Market Strength

A city with appreciating property values promises strong opportunities for any note buyer. It’s critical to know that if you have to foreclose on a property, you won’t have difficulty obtaining a good price for the collateral property.

A growing real estate market may also be a profitable area for making mortgage notes. It is another phase of a note investor’s career.

Some real estate investment companies are structured as trusts termed Real Estate Investment Trusts or REITs. Before REITs existed, investing in properties used to be too pricey for the majority of investors. The everyday person has the funds to invest in a REIT.

Shareholders in REITs are entirely passive investors. The exposure that the investors are taking is spread within a group of investment real properties. Shares may be unloaded when it’s desirable for the investor. Investors in a REIT aren’t allowed to recommend or pick properties for investment. The properties that the REIT decides to acquire are the properties your money is used for.

Mutual funds that hold shares of real estate firms are known as real estate investment funds. The investment real estate properties are not owned by the fund — they’re owned by the companies in which the fund invests. Investment funds are considered a cost-effective way to combine real estate properties in your appropriation of assets without unnecessary exposure. Investment funds are not obligated to distribute dividends unlike a REIT. As with other stocks, investment funds’ values rise and drop with their share price.

You may pick a fund that concentrates on specific segments of the real estate industry but not specific locations for individual real estate investment. Your choice as an investor is to pick a fund that you believe in to oversee your real estate investments.