Ultimate Surry County Real Estate Investing Guide for 2024

BRRRR means “Buy, Rehab, Rent, Refinance, Repeat”. BRRRR is a method for continuous expansion. This strategy hinges on your ability to extract cash out when you refinance.

You add to the value of the asset beyond the amount you spent buying and renovating the property. The rental is refinanced using the ARV and the balance, or equity, comes to you in cash. You buy your next house with the cash-out funds and begin anew. You buy additional properties and continually grow your lease revenues.

If your investment real estate portfolio is large enough, you may contract out its management and receive passive cash flow. Discover Surry County property management firms when you go through our list of experts.

Factors to Consider

Population Growth

The increase or decline of the population can illustrate if that location is appealing to rental investors. If the population growth in a city is strong, then more renters are definitely coming into the region. Moving businesses are drawn to growing markets offering reliable jobs to people who move there. A rising population develops a certain base of tenants who can handle rent bumps, and an active seller’s market if you decide to liquidate your assets.

Property Taxes

Property taxes, upkeep, and insurance spendings are examined by long-term lease investors for determining expenses to assess if and how the plan will pay off. Excessive expenses in these areas threaten your investment’s bottom line. Excessive real estate taxes may indicate an unstable city where expenses can continue to rise and should be thought of as a warning.

Price to Rent Ratio

The price to rent ratio (p/r) is a contrast of median property values and median lease rates that will show you how high of a rent the market can handle. If median property prices are steep and median rents are low — a high p/r, it will take more time for an investment to recoup your costs and achieve profitability. The less rent you can demand the higher the price-to-rent ratio, with a low p/r signalling a more profitable rent market.

Median Gross Rents

Median gross rents let you see whether a site’s rental market is reliable. Median rents should be expanding to warrant your investment. You will not be able to reach your investment predictions in a market where median gross rents are being reduced.

Median Population Age

Median population age will be close to the age of a typical worker if a community has a good stream of renters. You’ll learn this to be true in areas where workers are moving. If working-age people are not venturing into the region to succeed retiring workers, the median age will go up. This isn’t promising for the impending economy of that location.

Employment Base Diversity

Accommodating numerous employers in the city makes the economy not as unpredictable. If the residents are employed by a couple of dominant enterprises, even a little problem in their business could cost you a lot of tenants and expand your exposure substantially.

Unemployment Rate

You can’t have a steady rental cash flow in a community with high unemployment. Non-working individuals won’t be able to purchase products or services. Individuals who still have workplaces may discover their hours and wages reduced. Even renters who have jobs may find it tough to keep up with their rent.

Income Rates

Median household and per capita income rates show you if a high amount of preferred renters live in that city. Your investment analysis will include rental fees and asset appreciation, which will be based on salary raise in the market.

Number of New Jobs Created

An expanding job market equals a steady stream of tenants. A larger amount of jobs mean more renters. This gives you confidence that you will be able to keep a high occupancy rate and acquire more real estate.

School Ratings

The rating of school districts has a strong influence on real estate values across the community. When a business looks at a region for possible expansion, they know that good education is a must-have for their workers. Business relocation produces more renters. Homeowners who relocate to the area have a beneficial influence on housing prices. For long-term investing, hunt for highly respected schools in a potential investment location.

Property Appreciation Rates

Robust property appreciation rates are a must for a lucrative long-term investment. You want to make sure that the odds of your asset increasing in price in that location are good. Low or dropping property appreciation rates will remove a market from consideration.

Residential properties where renters reside in furnished units for less than thirty days are known as short-term rentals. Long-term rental units, such as apartments, require lower rent a night than short-term rentals. Short-term rental units may need more periodic upkeep and cleaning.

Home sellers waiting to move into a new residence, holidaymakers, and individuals on a business trip who are staying in the location for about week enjoy renting a residence short term. House sharing platforms such as AirBnB and VRBO have opened doors to many real estate owners to take part in the short-term rental industry. Short-term rentals are thought of as a good technique to start investing in real estate.

Short-term rental properties involve dealing with tenants more often than long-term ones. This dictates that landlords face disagreements more regularly. You may need to protect your legal bases by working with one of the best Surry County investor friendly real estate lawyers.

Factors to Consider

Short-Term Rental Income

Initially, calculate how much rental income you should have to achieve your desired profits. A glance at a community’s recent standard short-term rental rates will tell you if that is the right area for your investment.

Median Property Prices

When acquiring real estate for short-term rentals, you must determine the amount you can allot. To check if a city has possibilities for investment, study the median property prices. You can adjust your property search by looking at median market worth in the area’s sub-markets.

Price Per Square Foot

Price per square foot provides a general picture of values when analyzing similar properties. If you are analyzing similar kinds of property, like condos or detached single-family homes, the price per square foot is more consistent. If you take this into consideration, the price per square foot can give you a general view of real estate prices.

Short-Term Rental Occupancy Rate

The need for additional rental properties in a region may be seen by studying the short-term rental occupancy rate. A high occupancy rate indicates that a new supply of short-term rental space is required. If the rental occupancy indicators are low, there is not much place 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 inform you if the purchase is a reasonable use of your own funds. Take your expected Net Operating Income (NOI) and divide it by the cash amount you’re ready to invest. The answer you get is a percentage. High cash-on-cash return shows that you will regain your money quicker and the investment will earn more profit. If you get financing for part of the investment budget and use less of your own money, you will get a higher cash-on-cash return.

Average Short-Term Rental Capitalization (Cap) Rates

One measurement shows the value of a property as a return-yielding asset — average short-term rental capitalization (cap) rate. Usually, the less money a property costs (or is worth), the higher the cap rate will be. Low cap rates reflect more expensive investment properties. The cap rate is calculated by dividing the Net Operating Income (NOI) by the price or market value. This shows you a ratio that is the yearly return, or cap rate.

Local Attractions

Short-term rental properties are preferred in areas where visitors are drawn by events and entertainment spots. When a region has places that regularly hold sought-after events, like sports coliseums, universities or colleges, entertainment halls, and theme parks, it can invite people from out of town on a regular basis. Famous vacation spots are situated in mountain and beach points, alongside waterways, and national or state nature reserves.

To fix and flip a home, you should buy it for lower than market price, conduct any required repairs and enhancements, then dispose of it for better market price. The essentials to a successful investment are to pay less for the investment property than its full value and to accurately calculate the budget needed to make it saleable.

It’s important for you to know how much houses are going for in the area. Select an area that has a low average Days On Market (DOM) indicator. Disposing of real estate without delay will keep your costs low and ensure your profitability.

In order that property owners who need to get cash for their property can readily find you, highlight your availability by using our directory of the best cash real estate buyers in Surry County NC along with the best real estate investment firms in Surry County NC.

In addition, work with Surry County bird dogs for real estate investors. Professionals found here will help you by immediately finding potentially profitable deals prior to the opportunities being listed.

Factors to Consider

Median Home Price

The location’s median home value could help you determine a suitable city for flipping houses. If purchase prices are high, there may not be a steady source of run down houses in the location. This is a primary feature of a fix and flip market.

If market data shows a quick decline in property market values, this can highlight the availability of possible short sale properties. Real estate investors who work with short sale processors in Surry County NC get continual notifications concerning potential investment properties. Discover more concerning this sort of investment detailed in our guide How to Buy a Short Sale Property.

Property Appreciation Rate

Are real estate prices in the region on the way up, or moving down? Fixed growth in median prices articulates a robust investment environment. Volatile value shifts aren’t good, even if it’s a substantial and sudden surge. When you’re purchasing and selling quickly, an unstable environment can sabotage your investment.

Average Renovation Costs

Look thoroughly at the potential rehab expenses so you will find out whether you can reach your predictions. The manner in which the local government goes about approving your plans will have an effect on your investment as well. To create an accurate financial strategy, you will have to understand whether your plans will have to involve an architect or engineer.

Population Growth

Population increase is a solid gauge of the strength or weakness of the city’s housing market. When the number of citizens isn’t going up, there isn’t going to be an ample source of purchasers for your real estate.

Median Population Age

The median population age is a clear sign of the accessibility of ideal home purchasers. The median age in the community should equal the one of the typical worker. A high number of such people indicates a substantial source of home purchasers. The needs of retired people will probably not be included your investment project plans.

Unemployment Rate

You want to see a low unemployment rate in your potential city. An unemployment rate that is less than the country’s median is preferred. When the area’s unemployment rate is less than the state average, that’s an indicator of a preferable financial market. Non-working individuals won’t be able to buy your houses.

Income Rates

Median household and per capita income levels explain to you if you can get enough buyers in that area for your homes. The majority of people who buy residential real estate need a mortgage loan. Their wage will dictate how much they can borrow and if they can buy a home. The median income stats tell you if the area is eligible for your investment plan. Search for areas where the income is growing. If you want to augment the purchase price of your homes, you have to be certain that your clients’ income is also going up.

Number of New Jobs Created

Knowing how many jobs appear every year in the community adds to your confidence in a region’s economy. A growing job market means that a larger number of potential homeowners are comfortable with buying a house there. With more jobs created, more prospective homebuyers also move to the community from other districts.

Hard Money Loan Rates

Real estate investors who work with rehabbed properties frequently use hard money financing rather than regular mortgage. This plan allows them make desirable projects without holdups. Locate hard money lenders in Surry County NC and estimate their mortgage rates.

In case you are unfamiliar with this funding type, learn more by studying our guide — What Are Hard Money Loans?.

In real estate wholesaling, you search for a house that real estate investors may consider a lucrative opportunity and enter into a sale and purchase agreement to buy it. But you don’t purchase it: once you control the property, you allow another person to become the buyer for a price. The seller sells the house to the investor not the wholesaler. You are selling the rights to the purchase contract, not the home itself.

The wholesaling method of investing includes the use of a title insurance firm that understands wholesale purchases and is informed about and active in double close deals. Find Surry County title services for wholesale investors by utilizing our directory.

Learn more about how wholesaling works from our complete guide — Real Estate Wholesaling 101. When employing this investing plan, list your company in our list of the best property wholesalers in Surry County NC. This will help any possible customers to discover you and initiate a contact.

Factors to Consider

Median Home Prices

Median home prices in the city being assessed will quickly tell you whether your investors’ required investment opportunities are situated there. Since investors want properties that are on sale below market value, you will have to see reduced median prices as an implied tip on the potential source of homes that you may acquire for lower than market value.

A sudden downturn in housing worth may be followed by a large number of ‘underwater’ homes that short sale investors look for. Short sale wholesalers frequently gain benefits from this method. However, be cognizant of the legal liability. Learn about this from our detailed article Can You Wholesale a Short Sale House?. Once you’re keen to start wholesaling, look through Surry County top short sale lawyers as well as Surry County top-rated foreclosure law firms directories to locate the right advisor.

Property Appreciation Rate

Property appreciation rate enhances the median price stats. Real estate investors who intend to hold real estate investment assets will have to find that home prices are steadily going up. Dropping market values show an equivalently poor rental and housing market and will scare away investors.

Population Growth

Population growth stats are something that your potential real estate investors will be knowledgeable in. When the population is multiplying, new housing is needed. They realize that this will combine both rental and purchased residential units. If a region is shrinking in population, it doesn’t need new residential units and real estate investors will not look there.

Median Population Age

A good residential real estate market for real estate investors is agile in all areas, particularly renters, who become homeowners, who move up into more expensive houses. An area that has a large workforce has a constant supply of tenants and buyers. A place with these features will have a median population age that is equivalent to the wage-earning person’s age.

Income Rates

The median household and per capita income demonstrate steady improvement continuously in communities that are ripe for real estate investment. Income improvement demonstrates a city that can keep up with rental rate and housing listing price increases. Investors need this if they are to meet their expected profits.

Unemployment Rate

Investors will pay close attention to the market’s unemployment rate. High unemployment rate prompts a lot of renters to pay rent late or miss payments altogether. Long-term real estate investors will not acquire real estate in a market like that. Real estate investors can’t depend on tenants moving up into their homes if unemployment rates are high. This is a challenge for short-term investors buying wholesalers’ agreements to repair and resell a property.

Number of New Jobs Created

The amount of jobs produced every year is a critical element of the housing framework. Job production implies additional employees who require a place to live. Long-term investors, like landlords, and short-term investors which include rehabbers, are gravitating to areas with good job production rates.

Average Renovation Costs

An imperative variable for your client real estate investors, especially house flippers, are rehabilitation costs in the area. Short-term investors, like house flippers, will not make money when the acquisition cost and the rehab expenses equal to more than the After Repair Value (ARV) of the home. Seek lower average renovation costs.

Mortgage note investing involves purchasing debt (mortgage note) from a lender for less than the balance owed. When this occurs, the investor becomes the client’s mortgage lender.

Performing loans are loans where the debtor is regularly current on their mortgage payments. These loans are a consistent generator of passive income. Investors also buy non-performing mortgages that they either rework to assist the client or foreclose on to acquire the collateral less than market worth.

One day, you might have a lot of mortgage notes and need more time to manage them without help. In this case, you could employ one of third party mortgage servicers in Surry County NC that would basically convert your portfolio into passive income.

If you choose to adopt this strategy, affix your project to our directory of mortgage note buying companies in Surry County NC. When you do this, you will be discovered by the lenders who publicize profitable investment notes for acquisition by investors like you.

Factors to consider

Foreclosure Rates

Performing loan investors seek communities having low foreclosure rates. If the foreclosures happen too often, the location could nonetheless be profitable for non-performing note buyers. However, foreclosure rates that are high may indicate an anemic real estate market where selling a foreclosed house will likely be difficult.

Foreclosure Laws

Investors want to understand their state’s laws regarding foreclosure prior to investing in mortgage notes. They’ll know if the state dictates mortgages or Deeds of Trust. A mortgage dictates that you go to court for permission to start foreclosure. You do not need the court’s agreement with a Deed of Trust.

Mortgage Interest Rates

Note investors inherit the interest rate of the mortgage loan notes that they acquire. That rate will unquestionably influence your investment returns. No matter the type of note investor you are, the note’s interest rate will be critical for your forecasts.

Conventional interest rates can differ by as much as a 0.25% throughout the country. Private loan rates can be moderately more than traditional rates considering the more significant risk accepted by private mortgage lenders.

A mortgage note investor needs to be aware of the private and conventional mortgage loan rates in their regions at any given time.

Demographics

An effective mortgage note investment plan incorporates a study of the community by utilizing demographic data. It’s essential to find out whether enough residents in the area will continue to have reliable employment and incomes in the future.
A youthful growing region with a strong employment base can provide a stable revenue flow for long-term mortgage note investors hunting for performing notes.

Non-performing note buyers are interested in related elements for various reasons. When foreclosure is called for, the foreclosed home is more easily liquidated in a growing property market.

Property Values

The greater the equity that a homeowner has in their property, the better it is for you as the mortgage loan holder. When the value isn’t much more than the mortgage loan amount, and the lender decides to start foreclosure, the property might not generate enough to repay the lender. Rising property values help increase the equity in the home as the borrower reduces the amount owed.

Property Taxes

Payments for real estate taxes are most often sent to the lender simultaneously with the mortgage loan payment. By the time the property taxes are due, there needs to be enough money being held to pay them. If the borrower stops paying, unless the lender remits the property taxes, they won’t be paid on time. If a tax lien is put in place, the lien takes first position over the lender’s note.

If property taxes keep rising, the homeowner’s house payments also keep growing. Overdue borrowers might not have the ability to maintain growing payments and might stop paying altogether.

Real Estate Market Strength

A city with growing property values has strong opportunities for any note buyer. As foreclosure is a necessary element of note investment strategy, increasing real estate values are critical to finding a good investment market.

A strong real estate market might also be a profitable community for creating mortgage notes. For veteran investors, this is a useful segment of their business strategy.

A REIT, or Real Estate Investment Trust, means a firm that invests in income-producing real estate. This was first invented as a way to permit the ordinary investor to invest in real estate. The average investor has the funds to invest in a REIT.

REIT investing is considered passive investing. The risk that the investors are assuming is spread within a collection of investment assets. Shares can be liquidated when it’s convenient for you. Members in a REIT aren’t allowed to suggest or choose real estate for investment. The assets that the REIT picks to buy are the properties your capital is used to purchase.

Real estate investment funds are essentially mutual funds focusing on real estate businesses, such as REITs. The investment assets aren’t held by the fund — they’re possessed by the firms the fund invests in. Investment funds are an inexpensive method to include real estate properties in your appropriation of assets without unnecessary risks. Fund shareholders might not receive typical disbursements like REIT participants do. As with any stock, investment funds’ values increase and go down with their share price.

You can choose a fund that specializes in a selected kind of real estate you’re aware of, but you do not get to pick the geographical area of every real estate investment. As passive investors, fund members are satisfied to allow the management team of the fund make all investment choices.