Ultimate Union County Real Estate Investing Guide for 2024

BRRRR is an abbreviation of “Buy, Rehab, Rent, Refinance, Repeat”. BRRRR is a plan for repeated expansion. A vital piece of this program is to be able to obtain a “cash-out” refinance.

The After Repair Value (ARV) of the home has to total more than the combined purchase and renovation costs. Then you take the value you produced out of the asset in a “cash-out” refinance. You purchase your next rental with the cash-out amount and do it anew. This program helps you to reliably add to your portfolio and your investment revenue.

When an investor holds a substantial number of real properties, it makes sense to pay a property manager and establish a passive income stream. Discover Union County property management firms when you search through our list of professionals.

Factors to Consider

Population Growth

The growth or deterioration of a market’s population is an accurate barometer of its long-term desirability for rental investors. If the population increase in a region is high, then new renters are likely coming into the area. The location is attractive to companies and employees to locate, find a job, and create families. An expanding population builds a reliable foundation of renters who can stay current with rent bumps, and a strong property seller’s market if you decide to liquidate your assets.

Property Taxes

Real estate taxes, regular upkeep expenditures, and insurance directly affect your profitability. Investment assets located in steep property tax areas will provide smaller profits. Unreasonable real estate tax rates may indicate a fluctuating city where expenditures can continue to rise and should be considered a red flag.

Price to Rent Ratio

The price to rent ratio (p/r) is a contrast of median property values and median lease rates that will signal how high of a rent the market can handle. If median real estate prices are strong and median rents are weak — a high p/r — it will take longer for an investment to repay your costs and achieve good returns. The less rent you can demand the higher the p/r, with a low p/r signalling a stronger rent market.

Median Gross Rents

Median gross rents are an accurate yardstick of the acceptance of a rental market under discussion. You should find a community with stable median rent expansion. Reducing rents are an alert to long-term rental investors.

Median Population Age

The median population age that you are searching for in a dynamic investment environment will be approximate to the age of employed individuals. This could also illustrate that people are migrating into the city. If you find a high median age, your source of tenants is declining. That is a weak long-term economic scenario.

Employment Base Diversity

Accommodating numerous employers in the community makes the market less unstable. If the area’s employees, who are your tenants, are employed by a diverse group of companies, you can’t lose all of your renters at the same time (and your property’s value), if a significant enterprise in town goes out of business.

Unemployment Rate

It’s difficult to have a steady rental market if there is high unemployment. Non-working individuals won’t be able to purchase products or services. This can generate more dismissals or reduced work hours in the region. Even people who are employed may find it challenging to stay current with their rent.

Income Rates

Median household and per capita income stats show you if a high amount of desirable tenants live in that city. Your investment calculations will consider rental charge and asset appreciation, which will be based on income raise in the community.

Number of New Jobs Created

The strong economy that you are looking for will be producing plenty of jobs on a regular basis. A larger amount of jobs mean additional tenants. This gives you confidence that you will be able to maintain a sufficient occupancy level and acquire additional rentals.

School Ratings

School ratings in the community will have a huge effect on the local real estate market. When a business assesses an area for potential expansion, they keep in mind that quality education is a requirement for their workers. Good renters are a consequence of a steady job market. Homebuyers who move to the region have a beneficial influence on real estate market worth. Quality schools are an important requirement for a reliable property investment market.

Property Appreciation Rates

The foundation of a long-term investment approach is to keep the investment property. Investing in real estate that you aim to keep without being sure that they will rise in market worth is a recipe for failure. Small or decreasing property appreciation rates will exclude a city from your list.

A furnished house or condo where clients stay for shorter than 4 weeks is referred to as a short-term rental. Short-term rentals charge a higher rate per night than in long-term rental business. Short-term rental apartments may require more constant care and cleaning.

Home sellers waiting to relocate into a new home, holidaymakers, and corporate travelers who are staying in the area for about week prefer to rent a residential unit short term. Any property owner can transform their residence into a short-term rental with the services made available by online home-sharing portals like VRBO and AirBnB. Short-term rentals are considered an effective way to get started on investing in real estate.

Short-term rental unit landlords require interacting directly with the tenants to a greater extent than the owners of annually leased units. This leads to the owner being required to regularly handle grievances. You may need to cover your legal exposure by working with one of the good Union County real estate attorneys.

Factors to Consider

Short-Term Rental Income

You must determine how much rental income has to be earned to make your investment worthwhile. A quick look at a city’s recent typical short-term rental prices will tell you if that is the right market for your project.

Median Property Prices

When acquiring property for short-term rentals, you need to determine the budget you can pay. Search for cities where the budget you need is appropriate for the present median property prices. You can also make use of median values in particular neighborhoods within the market to pick communities for investment.

Price Per Square Foot

Price per square foot could be inaccurate if you are examining different buildings. When the styles of prospective properties are very different, the price per sq ft might not give a correct comparison. You can use this data to obtain a good overall picture of property values.

Short-Term Rental Occupancy Rate

The ratio of short-term rentals that are currently rented in a market is critical knowledge for a rental unit buyer. If the majority of the rental units are filled, that area requires more rental space. Low occupancy rates communicate that there are already too many short-term rental properties in that community.

Short-Term Rental Cash-on-Cash Return

To determine whether you should invest your cash in a specific property or location, look at the cash-on-cash return. Divide the Net Operating Income (NOI) by the amount of cash used. The resulting percentage is your cash-on-cash return. When an investment is profitable enough to recoup the amount invested soon, you will get a high percentage. Financed projects will have a stronger cash-on-cash return because you are using less of your capital.

Average Short-Term Rental Capitalization (Cap) Rates

Average short-term rental capitalization (cap) levels are largely employed by real estate investors to evaluate the value of rental units. Typically, the less money an investment asset will cost (or is worth), the higher the cap rate will be. Low cap rates show more expensive real estate. Divide your projected Net Operating Income (NOI) by the investment property’s market worth or listing price. The percentage you will get is the investment property’s cap rate.

Local Attractions

Big public events and entertainment attractions will attract visitors who need short-term rental houses. This includes top sporting tournaments, children’s sports activities, schools and universities, big auditoriums and arenas, fairs, and theme parks. Famous vacation spots are found in mountainous and beach points, along lakes, and national or state nature reserves.

The fix and flip approach entails purchasing a home that requires improvements or rebuilding, generating added value by enhancing the property, and then reselling it for a higher market worth. The keys to a successful fix and flip are to pay a lower price for the house than its current value and to accurately compute what it will cost to make it saleable.

It’s vital for you to understand what homes are selling for in the market. Select an area with a low average Days On Market (DOM) indicator. To effectively “flip” a property, you must resell the rehabbed house before you have to put out cash to maintain it.

To help motivated property sellers discover you, enter your business in our directories of all cash home buyers in Union County SC and property investors in Union County SC.

Additionally, look for the best bird dogs for real estate investors in Union County SC. Specialists in our directory specialize in acquiring desirable investments while they are still unlisted.

Factors to Consider

Median Home Price

The market’s median housing price will help you determine a suitable city for flipping houses. Modest median home prices are an indication that there is a steady supply of homes that can be acquired below market worth. This is an important element of a lucrative fix and flip.

If your investigation entails a fast drop in home market worth, it might be a sign that you will uncover real property that meets the short sale criteria. You will receive notifications about these possibilities by joining with short sale processors in Union County SC. Learn more about this type of investment detailed in our guide How Do You Buy a Short Sale House?.

Property Appreciation Rate

Dynamics relates to the path that median home prices are taking. You are looking for a steady growth of the city’s home values. Accelerated property value surges can indicate a value bubble that isn’t sustainable. Buying at an inopportune point in an unstable environment can be catastrophic.

Average Renovation Costs

A careful review of the area’s renovation expenses will make a significant influence on your area choice. Other costs, like authorizations, could increase your budget, and time which may also turn into additional disbursement. If you have to have a stamped suite of plans, you’ll have to include architect’s fees in your costs.

Population Growth

Population increase is a good indicator of the reliability or weakness of the area’s housing market. When there are buyers for your renovated properties, the statistics will show a robust population growth.

Median Population Age

The median residents’ age can additionally tell you if there are enough homebuyers in the location. When the median age is the same as the one of the usual worker, it is a good indication. Workforce can be the people who are potential home purchasers. Aging people are planning to downsize, or relocate into age-restricted or retiree neighborhoods.

Unemployment Rate

If you see an area demonstrating a low unemployment rate, it is a strong indication of likely investment prospects. The unemployment rate in a potential investment city needs to be less than the US average. If the region’s unemployment rate is less than the state average, that’s a sign of a strong financial market. Without a robust employment base, a city can’t provide you with abundant homebuyers.

Income Rates

The residents’ wage stats can brief you if the location’s financial market is strong. When home buyers acquire a property, they typically have to take a mortgage for the purchase. Their salary will determine how much they can borrow and whether they can buy a house. Median income can let you know whether the regular homebuyer can afford the property you are going to list. Search for areas where salaries are growing. To keep pace with inflation and rising construction and material expenses, you should be able to periodically adjust your prices.

Number of New Jobs Created

The number of jobs created on a consistent basis shows if income and population increase are feasible. An increasing job market indicates that more people are confident in buying a house there. Experienced skilled workers looking into buying a property and settling prefer moving to locations where they will not be jobless.

Hard Money Loan Rates

Those who buy, repair, and liquidate investment properties prefer to employ hard money and not typical real estate financing. This strategy enables investors negotiate profitable deals without delay. Research Union County hard money lending companies and look at financiers’ charges.

If you are unfamiliar with this loan vehicle, discover more by using our article — How Does a Hard Money Loan Work in Real Estate?.

Wholesaling is a real estate investment strategy that involves finding houses that are interesting to real estate investors and signing a purchase contract. An investor then “buys” the purchase contract from you. The investor then settles the transaction. The real estate wholesaler doesn’t sell the residential property itself — they simply sell the rights to buy it.

Wholesaling depends on the assistance of a title insurance firm that is comfortable with assigning purchase contracts and understands how to deal with a double closing. Look for title companies for wholesaling in Union County SC that we collected for you.

Learn more about how wholesaling works from our definitive guide — Wholesale Real Estate Investing 101 for Beginners. As you choose wholesaling, include your investment project on our list of the best wholesale property investors in Union County SC. That will help any desirable clients to see you and get in touch.

Factors to Consider

Median Home Prices

Median home prices in the area being considered will quickly inform you whether your real estate investors’ target real estate are located there. As investors need properties that are available below market price, you will need to see below-than-average median prices as an implicit hint on the possible availability of houses that you may buy for lower than market value.

A quick decrease in the price of real estate could cause the sudden availability of houses with owners owing more than market worth that are hunted by wholesalers. Short sale wholesalers frequently receive advantages from this opportunity. But, be aware of the legal challenges. Learn about this from our guide How Can You Wholesale a Short Sale Property?. When you choose to give it a try, make certain you employ one of short sale lawyers in Union County SC and mortgage foreclosure lawyers in Union County SC to work with.

Property Appreciation Rate

Property appreciation rate enhances the median price stats. Investors who want to sit on real estate investment properties will want to find that home market values are steadily increasing. Both long- and short-term real estate investors will ignore a community where housing values are going down.

Population Growth

Population growth information is critical for your potential contract buyers. A growing population will require new residential units. There are a lot of people who rent and additional clients who purchase real estate. If a community isn’t growing, it doesn’t require new houses and investors will look in other areas.

Median Population Age

Investors need to be a part of a reliable property market where there is a good supply of tenants, first-time homebuyers, and upwardly mobile residents moving to better houses. An area with a big employment market has a steady pool of renters and buyers. An area with these attributes will show a median population age that mirrors the working adult’s age.

Income Rates

The median household and per capita income should be increasing in a friendly real estate market that investors want to operate in. Increases in lease and asking prices will be aided by improving income in the area. That will be crucial to the property investors you want to reach.

Unemployment Rate

The community’s unemployment numbers are a key consideration for any targeted contracted house purchaser. Renters in high unemployment places have a tough time paying rent on schedule and some of them will stop making rent payments altogether. Long-term investors who depend on steady lease payments will lose money in these markets. High unemployment creates unease that will keep interested investors from purchasing a property. Short-term investors will not risk getting pinned down with real estate they can’t sell quickly.

Number of New Jobs Created

The amount of additional jobs appearing in the local economy completes an investor’s analysis of a potential investment spot. More jobs appearing mean a high number of workers who need places to rent and buy. Long-term real estate investors, like landlords, and short-term investors that include rehabbers, are gravitating to communities with strong job creation rates.

Average Renovation Costs

An imperative consideration for your client investors, especially house flippers, are renovation costs in the region. Short-term investors, like fix and flippers, don’t make a profit when the acquisition cost and the repair expenses amount to a higher amount than the After Repair Value (ARV) of the property. Lower average remodeling spendings make a location more desirable for your top clients — flippers and long-term investors.

Buying mortgage notes (loans) pays off when the mortgage loan can be obtained for less than the face value. When this happens, the note investor becomes the client’s lender.

Performing loans mean mortgage loans where the homeowner is regularly on time with their loan payments. Performing loans give you monthly passive income. Note investors also invest in non-performing mortgage notes that the investors either re-negotiate to assist the debtor or foreclose on to obtain the collateral less than market value.

One day, you might produce a number of mortgage note investments and be unable to oversee the portfolio by yourself. At that point, you might need to use our list of Union County top third party loan servicing companies and reassign your notes as passive investments.

When you decide to try this investment method, you ought to include your venture in our list of the best real estate note buying companies in Union County SC. This will make your business more noticeable to lenders providing lucrative opportunities to note investors like you.

Factors to consider

Foreclosure Rates

Low foreclosure rates are a signal that the area has opportunities for performing note purchasers. Non-performing loan investors can carefully take advantage of locations with high foreclosure rates as well. But foreclosure rates that are high can signal a weak real estate market where getting rid of a foreclosed house may be a problem.

Foreclosure Laws

Note investors should know their state’s regulations concerning foreclosure before buying notes. Are you working with a mortgage or a Deed of Trust? While using a mortgage, a court will have to agree to a foreclosure. You merely need to file a notice and proceed with foreclosure steps if you are utilizing a Deed of Trust.

Mortgage Interest Rates

The mortgage interest rate is determined in the mortgage loan notes that are bought by mortgage note investors. This is a significant element in the profits that you reach. Mortgage interest rates are crucial to both performing and non-performing mortgage note investors.

Traditional interest rates may vary by up to a quarter of a percent around the country. Loans issued by private lenders are priced differently and may be higher than conventional loans.

A mortgage loan note buyer ought to be aware of the private as well as conventional mortgage loan rates in their regions at any given time.

Demographics

A neighborhood’s demographics statistics allow note buyers to streamline their efforts and effectively use their assets. The location’s population increase, unemployment rate, job market growth, pay levels, and even its median age hold valuable information for investors.
A young expanding market with a strong job market can contribute a consistent revenue stream for long-term note buyers searching for performing notes.

Note investors who seek non-performing mortgage notes can also make use of dynamic markets. A strong regional economy is needed if investors are to locate buyers for properties they’ve foreclosed on.

Property Values

As a mortgage note buyer, you should look for deals that have a cushion of equity. If the investor has to foreclose on a mortgage loan with little equity, the foreclosure sale may not even repay the balance owed. As mortgage loan payments decrease the balance owed, and the market value of the property appreciates, the borrower’s equity goes up too.

Property Taxes

Escrows for property taxes are most often sent to the mortgage lender simultaneously with the mortgage loan payment. The mortgage lender pays the taxes to the Government to make sure they are paid promptly. If mortgage loan payments aren’t being made, the lender will have to either pay the property taxes themselves, or they become delinquent. If a tax lien is put in place, it takes precedence over the mortgage lender’s note.

Since tax escrows are included with the mortgage loan payment, rising taxes indicate higher mortgage payments. This makes it tough for financially weak homeowners to stay current, and the mortgage loan could become past due.

Real Estate Market Strength

A place with growing property values has excellent opportunities for any mortgage note buyer. It’s critical to know that if you need to foreclose on a property, you will not have difficulty obtaining a good price for the collateral property.

A growing real estate market might also be a profitable place for initiating mortgage notes. For successful investors, this is a beneficial part of their business plan.

Many real estate investment businesses are structured as a trust termed Real Estate Investment Trusts or REITs. REITs are created to enable ordinary investors to invest in properties. The everyday investor can afford to invest in a REIT.

Participants in real estate investment trusts are totally passive investors. Investment risk is spread throughout a portfolio of investment properties. Shares may be sold when it is convenient for the investor. Something you cannot do with REIT shares is to choose the investment properties. Their investment is limited to the assets selected by their REIT.

Real estate investment funds are essentially mutual funds that concentrate on real estate firms, including REITs. The investment properties aren’t possessed by the fund — they’re held by the firms in which the fund invests. Investment funds are considered an affordable way to include real estate in your allotment of assets without unnecessary liability. Funds are not required to pay dividends unlike a REIT. The return to investors is generated by increase in the worth of the stock.

You are able to choose a fund that concentrates on specific segments of the real estate industry but not specific areas for individual real estate investment. You must rely on the fund’s directors to choose which markets and assets are chosen for investment.