Residential Real Estate Investing

Before investing, it's crucial to assess the prevailing market value of nearby comparable properties and examine historical trends and future projections to ensure a favorable deal and understand potential future value

Investing in Residential Real Estate

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How will you help me avoid the common mistakes of investing?

In a word, “risk”. How much risk are you willing to take? How risk tolerant are you?

4 main pillars of real estate investment:

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Cash Flow

Appreciation

Tax Savings

Equity

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Market Value

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It is important to understand the current market value of similar properties in the area before investing to ensure you're getting a good deal.

We can help you research past trends and future projections to help you get a better understanding of what the property might be worth in the future

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The Most Important Factors for Investing in Real Estate

Location

Valuation

Investment Purpose

Investment Horizon

Expected Cash Flows

Profit Opportunities

Leverage - Know the Pitfalls

Investment in New Construction vs. Existing Inventory

Indirect Investments in Real Estate (ex: Partnerships)

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6 Types Of Real Estate Investment Risks That Investors Need To Know

  • 1

    Structural Risk

    The financial structure of the investment and the various rights that structure provides to the individual participants

  • 2

    General Market Risk

    The risk of a broad market movement that can affect the value of your investment

  • 3

    Financial Risk

    The possibility of losing money on your investment or business venture and the associated "opportunity" costs

  • 4

    Asset-Level Risk

    A detailed analysis of the risks associated with a specific property

  • 5

    Legislative Risk

    The potential relationship between government and business and how that could affect the value of your investment

  • 6

    Location Risk

    Any type of natural disaster that a business may encounter — such as fires, floods, hurricanes, earthquakes, tornadoes, or winter storms is always a consideration

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Investor Rules you should know

Rules You should Know

Rule of 5

Multiply the value of the home by 5%, then divide that number by 12 to get your breakeven point. If the monthly rent on a comparable home is below the breakeven point, it makes financial sense to rent. If the monthly rent is higher than the breakeven point, it makes financial sense to buy.

Rules You should Know

80% Rule

The 80% rule means that an insurer will only fully cover the cost of damage to a house if the owner has purchased insurance coverage equal to at least 80% of the house's total replacement value.

Rules You should Know

70% Rule

The 70% rule can help flippers when they're scouring real estate listings for potential investment opportunities. Basically, the rule says real estate investors should pay no more than 70% of a property's after-repair value (ARV) minus the cost of the repairs necessary to renovate the home.

Articles for Residential Investments

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Investing in residential real estate can be complicated

We can walk you through the process. Let's set up an appointment to talk about your goals.

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