So by now you have heard that there are outstanding real estate deals out there due to the current financial conditions. So how do you go about finding and evaluating these great investment deals? Well, first you want to choose your hunting area, this can be one of the most important choices when dealing with real estate investments. You need to know the demographics of the area before you buy a property there. You will want to choose a large enough area that will have a good number of wholesale homes.
- Know the economic situation of the local residents.
- Find out what kind of schools are in the area and their ratings.
- Analyze and experience the traffic conditions at peak times.
- Research the rental/owner ratios of the area.
- Choose an area you have extensive knowledge about when starting out
OK, so you have chosen an area, you now need to research it. You may assume you already know an area even if you live there, but there is a lot to learn when you are investment minded. First, evaluate the time on market for recent sales, find out what neighborhoods sell fast and which ones are stagnant. Go to open houses, check the sign-in list for interest in the homes that are currently for sale, Look at the quality of the construction of the homes in different neighborhoods. Remember, this is for you to build a profile about the area neighborhoods, you will use this information later when you actually make an offer on a home or find a deal in one of these subdivisions.
- Keep notes on each subdivision you analyze
- Track the average number of bedrooms, baths & square footage in a given neighborhood
- Choose whether neighborhoods would make good rentals or sales.
- Stay away from condos and other multi-family homes.
In our next article we will look at the next step, finding investment properties.
