If you are an investor this is the best of times. If you are losing you home to foreclosure this is not only the worst of times but you may be faced with a double whammy with the rising rent costs.
Do the math: Look at the area you live in and find the median house rate; in our area (South of Atlanta) It is approximately $108,000. In today's market with the normal 10% required down payment (or tied to un-leveraged property) you will be looking at a payment of around $950.00 plus or minus & add for taxes and insurance. Now in this priced home there will be little cash flow for the average rent is normally 10 - 20% higher than the normal House Payment. Which of course is all relative to many variables. So will my area carry this relative house a $1100 a month rent? If not then I need to find a better priced home; which in our case at this time in our economic break down it is not only possible but investors are liquidating banks of their REO properties every where! At cents on the dollar. Why? The fiscal year is ending for most banks from October - February and they do not want them on their books. It is a write off for them. Now is the time to buy, perform minor repairs & rent them out for a return, because you will not get it in the bank.
Keep in mind these number indicate an estimated cash flow of income to mortgaged expense. Every investor needs to account for maintenance, increased property taxes, vacancy and a number of other items. My are not to indicate exact cash flow, but simply that there is available now in a short window span unprecedented opportunity for the most cash flow. There are a number of websites that can be found to give you averages and estimates.
Subscribe to:
Post Comments (Atom)
No comments:
Post a Comment