Over the years investors have always wanted to know which way they should go. Buy a house cheap, fix it up and rent it out. Over time collect the cash flow, keep some and use a portion to pay the house off. It’s the oldest and truest way to build wealth and a secure retirement.
Then there are those who are seriously focused on making some money now. They either want to “Wholesale” a house doing nothing to it all or the alternative option may be to acquire, renovate and sell for a really good profit and do it again. This method doesn’t build wealth but you can make some potential steady income.
Truly good real estate investors know the valuation of their deals is key to insuring success and protecting projected profits. To effectively determine if a deal is a rental building wealth or flip to make some much needed cash, you have to analyze a deal fully. All the market areas covered by REIAComps.com, insure you easily know which way an investor should go.
One of the swiftest ways to determine if you are looking at a potential wealth building unit is to review the buyers on the REIAComps.com report. A market typically ideal for rental property will show multiple transactions with LLC’s, Trusts, Property Management firms, etc. buying up houses. Clearly, a prime area for you to buy and intentionally start building your wealth portfolio.
Conversely, as you are trying to determine if you can buy a home to flip, the buyers in a market must be individuals or couples which are taking out conventional or FHA mortgages to buy homes and live in them long term. This is your sign that most any house acquired, which is renovated nicely, can be easily resold for a profit. You need to be careful to make your offer to acquire at the right price. Doing so gives you room to be flexible in your choice of materials for renovation. Equally, should there be a need to adjust your sales price due to competition or a slowing market, you can still sell and make some quick cash.
Over the years we have helped many clients using our Online Valuation Support Desk, assisting them to clearly identify which direction to go. It takes reviewing several deals and the related data to each to determine and build the skills needed to quickly know a sure wealth building unit from one which will put five figures in your pocket in less than six months.
Source: Is It A Rental Or Flip?