6 Cost-Effective Ways to Boost Your Investment Home’s Curb Appeal

Curb AppealWhether you are planning to list a fix-and-flip house soon or prep it for rental, it is important to know which curb appeal improvements will add the most value to the property. To make sure your investment home’s curb appeal is up to snuff, we put together a list of six home improvements projects to take a stab at this summer.

Upgrade the Garage Door

Replacing your garage door is an item that is high on the list of desired home renovations. According to Renovation Magazine, home sellers recoup 84% of the investment of replacing a garage door. A whiter, cleaner door will help with curb appeal or give a more modern look.

Try a Front Door Facelift

Consider painting or staining your front door to give it a fresh new look. Summer is an excellent time to make a bold color choice that will help your investment home stand out.

Keep Up with Your Lawn Care

It may seem simple, but basic lawn care and a well-kept yard can add significant value to your property’s curb appeal. Make sure to keep your lawn and shrubbery well-manicured and water your plants and flowers to keep them lively.

Pressure-Wash Your Driveway

Over time, concrete driveways and sidewalks can collect mildew and stains, making them unsightly and decreasing the curb appeal of your investment home. These stains can also weaken the concrete, making it more susceptible to cracking. You can rid your sidewalks and driveway of stains quickly and efficiently by using a pressure washer while using less water than a traditional garden hose.

Upgrade Your Walkways

In addition to power-washing the driveway and walkways around your investment home, replace any chipped or broken stones and trim away weeds and grass along the edges to give them a more refined look. There are several types of lawn edging tools for every budget, from manual to electric to gasoline-powered ones.

Update the Lighting

Exterior lighting is a simple and inexpensive way to add gorgeous curb appeal as well as security to your home. To create a dynamic impact for your home, there are few more cost-effective options than lighting. A simple spotlight can accent your landscaping and showcase your home’s façade, while floodlights can provide additional safety. Even inexpensive solar lights along walkways and gardens can make a big difference.

Are you ready to invest in real estate and see the value it can provide? RLG would love to help you! Call us today to learn more!

Considering Location When Purchasing Real Estate Investments

There’s no doubt that location is one of top criteria real estate investors consider when purchasing an investment property. And it certainly makes sense that you would want to carefully weigh potential neighborhoods in the balance before you settle on a house. While you can renovate a home, put in a pool or add more livable space, it is not possible to move your property elsewhere.

If you are on the fence about a neighborhood, here are some factors real estate investors will consider when picking the right location:

Price

As obvious as it may sound, some neighborhoods are just more expensive than others. If you are looking to buy a property in a more affluent area and still maximize your profits, chances are you are going to have to compromise on certain features. That often means settling for less square footage, fewer amenities, or properties that are older or in need of repair. Ultimately, it comes down to whether or not you are willing to sacrifice some wish list features to stay in budget.

Amenities and Recreation

Amenities and recreational facilities are valuable attractions for homebuyers. These facilities may include swimming pools, play fields, tennis courts, club houses, community docks and lakes. Other outside features that can pique homebuyers’ interest are nearby parks, open play meadows, and direct access to water bodies.

Safety

Lower crime rates are yet another important factor real estate investors and homebuyers pay close attention to. The good news is that there are many online tools out there to help you research a neighborhood’s safety levels, such as ADT Crime, Neighborhood Scout, and SpotCrime.

School District

Before any property purchase, you will likely do your due diligence about the quality of the school district. Families with school-age children will make a special effort to live in areas where their kids have access to good education. It’s a good idea to buy properties in neighborhoods served by well-rated schools so you don’t miss out on that market share.

Proximity to Public Transport

Homebuyers in sprawling cities should consider the proximity to public transport when purchasing an investment home. It is clear that public transit can increase the property’s value and rents. However, the cause-effect relationship is affected by many factors and conditions, such as local regulatory framework, regional connections, and national and regional economics. Thus, real estate investors must carefully examine the impact of transit on the property’s value.

Are you ready to invest in real estate and see the value it can provide? RLG would love to help you! Call us today to learn more!

Making a Fair Offer on an Investment Property “As Is”

Selling a house “as is” means that the seller is putting the house on the market without making any repairs or improvements to it. There are a number of reasons why people choose to sell a house as is. Perhaps the seller is in financial trouble or must relocate quickly to care for an ailing parent. Sometimes, a home is inherited by an out-of-state relative who doesn’t have the time or resources to maintain or renovate it. More often than not, they simply want to avoid making costly repairs.

Whatever the reasons may be, many real estate investors build their business models around helping homeowners in these kinds of situations to move out and get on with their lives. If you have your eyes set on an investment property listed for sale “as is” and want to make sure it is priced right, your offer should be based on these key factors:

  • Comparable homes in the neighborhood
  • The potential cost of repairs

For example, if comparable homes in the area are worth $250,000 and the cost of repair is around $30,000, a fair market value would be no more than $220,000. Though this math can be helpful in determining how much you may be willing to pay, a fair offer will also factor in whether the area is experiencing a seller’s market, the number of houses available for sale, the growth outlook for the area, and seasonal patterns in the market.

To ensure the purchase makes sense, investors should always elect to do a home inspection. While you will have to foot the bill for the inspection, it is well worth it as it may reveal any additional problems and can often help you negotiate down the final price.

Are you ready to invest in real estate and see the value it can provide? RLG would love to help you! Call us today to learn more.

4 Ways to Quickly Sell an Investment Property

If you are in the business of flipping investment properties, you know that time is a key factor to making profits. By quickly selling a fixer-upper, you are cutting down on monthly expenses, such as maintenance and utilities, while maximizing your returns. With that said, there are some ways you can facilitate the sale of your properties. Here are some tips to help you sell an investment property posthaste:

  1. Deal with Homebuying Companies

Private individuals looking for their dream home are likely the most demanding group of buyers. If you don’t have time to waste, dealing with homebuying companies may be your best bet. These companies will typically buy houses for cash to ensure a fast closing and put in an offer without much ado. This means that you won’t have to worry about the buyer being approved for financing or bankroll expensive repairs.

  1. List Online

Listing a property online is a sure-fire way to get your investment properties more exposure. But rather than settling with one platform or website, branch out and promote your homes across all channels, including social media. If you’re hosting an open house, you can use Instagram’s “Live” feature to give followers a taste of what is happening in real time.

  1. Make Repairs

Some repairs are inevitable if you want to avoid a lengthy home sale. As buyers will predictably order an inspection before closing, you might as well take care of some of the home’s issues beforehand and curtail potential negotiations that could drag out the process even longer. Hire a professional to inspect your property and make the recommended repairs or improvements.

  1. Time it Out

Spring is the best time of the year for the real estate market. With the increased demand during the months of April, May and June, it is wise to time the renovation of your investment home so that it’s ready for listing by springtime. More demand means not only more buyer traffic, but also higher prices, which can be a boon to sellers. Other market circumstances to consider include mortgage rates, tax outlook, and economic growth.

Are you ready to invest in real estate and see the value it can provide? RLG would love to help you! Call us today to learn more!

When Is Renovation Worth the Investment?

renovationHome renovations can be an effective way to add value to your investment properties. While some renovations may instantly increase your home’s value, others may not be worth the upfront expense. To help you determine whether or not to pursue a particular remodeling project, we rounded up a few useful tips.

  1. Take Stock

Assess the magnitude of a project to determine how much work will be required. To do so, you will want to map out every step involved in the execution of the project. If you have a specific timeframe in which you are looking to sell the house, factoring in each step of the renovation will give you a better understanding of the estimated time of completion.

  1. Tally Up Costs

With so many items and work associated with a home renovation, it is important to budget for the expenses you expect to incur during the project. Build a spreadsheet that includes costs of labor and materials. This will ensure that you don’t overspend and allow you to more accurately ascertain the overall value it will add to the home. If your costs are higher than the estimated value added, the remodel is not worth the investment.

  1. Cut Expenses Where Possible

Review your financial spreadsheet carefully and determine if there are any parts of the project you can save on. Perhaps you can paint the walls or stain the deck yourself. Just make sure you don’t overestimate your skills, or you risk a sloppy project.

  1. Get Multiple Quotes

Talk to at least three contractors to learn about the services they provide and their pricing. Often times, a cheaper quote will not always be your best bet. While affordability is a key factor, a strong track record and clear communication are equally important to ensure the service provided meets your expectations.

  1. Consider the Neighborhood

If you are considering purchasing an investment property to flip and resell, make sure you do extensive research on the projected growth for the area in which the property is located. If the neighborhood is poised for growth, you will have more flexibility with the time spent on the renovation.

Would you like to speak with a member of the RLG team to discuss the value of your current investment property portfolio and determine areas for improvement? Give us a call today! We would love to help you work with the properties you currently have and multiply your investment portfolio.

4 Maintenance Tasks to Boost Your Property’s Resale Value

Investing in real estate is the roadmap to passive income and financial freedom. Additionally, investors may take advantage of tax benefits, all the while seeing their property appreciate over the next months and years. To ensure that your property’s resale value continue its upward trend, you won’t necessarily have to undertake a series of home improvement projects. Rather, making a few basic home maintenance tasks your top priority may reap more benefits than you could imagine.

Let’s have a look at four of these maintenance tasks that can help bump up your investment property’s resale value.

Yard Work

Regularly mowing your lawn will help maintain the curb appeal of your investment property and attract higher-paying buyers. Homes with neglected, overgrown yards will spook prospective homebuyers and have a negative impact not only on your property’s value but also your neighbors’.

To avoid getting in trouble with your HOA and unloading your investment home at a fraction of what you could sell it for, pay close attention to your lawn by frequently mowing, watering, weeding, and fertilizing the grounds.

Garden

Starting a garden can increase the value of your home while attracting wildlife and adding flavor to your cooking and fragrance to your home. Spring is the best time to start a garden so you can watch your plants grow throughout the season.

To create a bountiful garden, be sure to mark out the area that you are planning to clear and improve the soil using organic compost first.

Erosion Control

Land degradation from soil erosion can have devastating effects on your property’s resale value. Without a protective topsoil layer, homes can start to slide, putting an enormous strain on their foundation. This can lead to cracks, sagging roofs, buckling walls and even a total foundation failure. There’s also an increased chance for landslides and flooding.

Fortunately, there are several ways to reduce the impact of erosion and prevent its far-reaching effects on your investment home. Planting bushes, trees, and grass around your home can be an effective maintenance strategy. If the soil isn’t suited for planting, you can use rocks and mulch. Having gutters and downspouts properly placed to divert rainwater away from your home is also very important.

Pest Control

Pest and rodents can make a serious dent in your property’s value if left unchecked. They can also pose health issues to occupants and cause significant damage to garden plants. The best way to prevent infestation is to remove possible entry points to your home and hire professional exterminators.

Just keep in mind that treating the area during blooming season may scare pollinators away from your home, so it’s best to wait until it is over. When it comes to pesticides, there are a lot of options out there that are harmless to bee and other pollinators.

Are you ready to invest in real estate and see the value it can provide? RLG would love to help you! Call us today to learn more!

5 Low-Budget Ways to Spiff Up Your Investment Property

Investment Property, new backsplash

Investment Property, new backsplashWhether you are skimping and saving for your next real estate purchase or putting off any major renovations on a rental home until they are inevitable, you can still give your investment property a facelift without spending a small fortune. Low-budget overhauls can have a significant impact on vacancy rates. Similarly, if you were to sell the home, you might get more money for it.

We have rounded up some creative ways to give your investment property some oomph on a tight budget. Check it out:

  1. Lighting

Upgrade the lighting with dimmable LED bulbs. In addition to their energy efficiency, these lights can help create more intimate ambiances or even make your kitchen look brighter and fresher. While you are at it, you might also want to consider changing out the light fixture!

  1. Storage Space

A home with plenty of storage space is something most tenants look for. While building in new cabinets or closets can be pricey, you could opt to invest in more affordable shelving units. Additionally, be sure to add new hangers, rods, hooks, and baskets to allow tenants to store sundries. A fresh coat of paint to existing cabinetry can also make a big difference in your investment property.

  1. Backsplash

If you have a boring, plain backsplash, consider painting it over. If you have a tile backsplash, you can check out tile stickers and decals to cover them with. They are inexpensive and easy to apply.

  1. Tile Grout

Speaking of tiles, while they can be incredibly beautiful and timeless, the grout will inevitably begin to show signs of wear and tear. This can make your tiles look rather lackluster. If you notice cracks and discoloration in the grout, it is time to renew it.

  1. Garage door

We know what you’re thinking. A new garage door might not be the cheapest way to update the look of your investment property, but it is worth every penny! A garage door that doesn’t match the overall aesthetics of the home can take away from the home’s curb appeal.

With around $1000 to $2000, you can replace your garage door with a newer and higher-quality one, which will allow you to raise your property’s rent a bit to recoup the costs and make more money over time.

Would you like to speak with a member of the RLG team to discuss the value of your current investment property portfolio and determine areas for improvement? Give us a call today! We would love to help you with the properties you currently have and multiply your investment portfolio.

Finding Your Niche Investment Property

Townhomes, Investment Property

Townhomes, Investment PropertyFocusing your investment property strategy on a particular clientele often translates into success in the industry. When you invest money within your niche market, you are able to outperform your competition and secure better deals as you can target your audience more efficiently and identify pain points to minimize your risks. In addition to financial incentives that come with finding a niche, because you are operating in a more focused segment, the relationship between your brand and your customers becomes stronger, which is a key component to customer retention.

The most common way to specialize in real estate investing is by property type. Some popular investment property types include single-family, duplex/triplex, condos, raw land, commercial, REITs, and large apartment buildings. Let us delve a bit deeper into each category.

Single-Family

A single-family is an independent residential unit that sits on its own land. One of the benefits of this investment property type is that supply is plentiful, and market is vibrant as the vast majority of Americans would prefer to live in a detached, single-family home. From a landlord’s standpoint, it is worth noting that maintenance and repair costs are typically higher than, say, a condo.

Duplex/Triplex

Duplexes and triplexes are similar to houses in that they occupy their own land. But like apartment buildings, these investment properties generate higher rental income with lower relative expenses. Another great benefit is access to an array of lending products with favorable terms. If you are buying a multi-family investment property, you can qualify for a FHA loan, which allows for lower interest rate and down payment as low as 3.5%. Additionally, these loans are typically more forgiving when it comes to credit scores.

Condo

Condos are individually owned units that are part of a multi-unit complex. The allure of this type of investment property lies in more affordable purchase prices and fewer repair and maintenance expenses. Monthly HOA fees, however, can eat into your profits so it is important to budget for these when deciding to buy a condo. Furthermore, if your goal is the appreciation potential, keep in mind that single-family homes tend to appreciate more than condos.

Raw Land

Raw land is an investment property in its most natural state, with no improvements or infrastructure. While the niche for raw land is smaller, there are a number of considerations that need to be addressed when purchasing raw land. Make sure you have a plan for the intended use of the parcel, whether it is building a home, farming, running livestock, or diversifying your portfolio.

Commercial

A commercial investment property includes but is not limited to office buildings, retail space for lease, and warehouses. Because commercial properties come in all shapes and forms and serve various purposes, it is essential to do your due diligence about the subniches within this niche. Unlike residential loans, the terms of commercial loans typically range from 5 to 20 years.

REIT

A real estate investment trust (REIT) is a publicly traded entity that owns, operates, or finances income-generating real estate. REITs generate steady income stream for investors but offer little in the way of capital appreciation.

Large Apartment Building

Apartment buildings are defined as those containing 100 or more units. With more residences for rent, you have more economy of scale and are able to spread costs over multiple income streams, thereby reducing your risk exposure. The price points, however, are higher and oftentimes require a combination of commercial loans and higher down payments.

Are you looking to invest in a specific niche? RLG has the tools and resources at its disposal to get you on your way to purchasing the right investment property for you. Call us today to learn more and experience firsthand the dedicated, personalized customer service, and undivided attention that RLG has to offer!

The Effects of COVID-19 on Single-Family Rentals

House for rent, single-family rentals, investment property

House for rent, single-family rentals, investment propertyThe COVID-19 pandemic has affected most every aspect of our lives. Many Americans have been teleworking and all of us have been advised to keep physical distance from others due to the incredibly transmissible virus. As a result, many folks have been giving second thought to the kind of lifestyle they want. In a switch, Americans are gravitating away from large, densely populated cities in search of more space.

While the apartment rental market has remained active throughout the pandemic, the industry has noted an uptick in renters deciding not to renew their leases in favor of houses and apartments with lower rent. Rental prices in larger, more expensive cities have decreased as renters have moved to the suburbs, which has driven rental prices up there.

We have all watched the news reports of Americans migrating from larger cities like New York, Chicago, and San Francisco to less populated areas. Some report as many as 30% of Americans have begun to consider following this trend. As the pandemic continues, many corporations are rethinking the steep overhead of office space and are getting used to the reality that telecommuting has terrific advantages. This makes it easier for people to work further from city centers and company headquarters. And many renters and other city dwellers are hunting for space and a home where they can be more socially distant. Herein lies great potential for the astute investor.

Single family homes outside of major cities present strong opportunities for investors looking for return on investment. Demand for single family rental properties across the country, especially in the suburbs, is growing sharply. Renters and buyers alike seek privacy and space like never before making single-family homes an incredibly smart investment now. And the demand for single-family homes appears poised to continue growing as folks who held off on purchases during the last eight months return to the market. Erstwhile urban-loving millennials, in particular, might be a smart focus for investors as they may be most likely to seek a rental single-family dwelling.

Call RLG today to continue this discussion and to learn how our financial experts can help grow your business.

Fix and Flip: Estimating Rehab Costs and Profit

fix-and-flip loan

fix-and-flip loanSavvy investors focused on fix-and-flip properties know that estimating rehab costs is perhaps the most critical and challenging part of the deal. If your estimate to fix-and-flip the property is too high, you will likely lose the deal to another investor. If you underestimate, your potential profit will adversely be affected.

The better you assess rehab costs, the more successful you will be. Let us look at some key aspects to consider as you estimate rehab costs that will help ensure a strong ROI:

  • Know your buyer and neighborhood: Study the comparables – recently sold properties in the neighborhood similar to the property you are interested in – so you have a clear idea for how much you should be able to sell the house. If the property is in an upmarket neighborhood, potential buyers will want higher end rehabs. If it is in a med-low income neighborhood, you will need to spend less on the total project.
  • Spend time in the property and note problems: With an idea of how you want the property to look post flip, have a checklist in hand as you walk through the home. Take notes of all issues or problems with the home that you will want to address. If you need help, take your contractor with you. Taking photos and videos is also a great tip.
  • Begin your estimate: Sort your check list into categories (Exterior, Foundation, Interior, etc) and include other line items such as contractors. Either from experience, with the aid of a contractor, or by searching the web, assign costs to the items in each category so you come up with total costs for each category. Now you know your estimated rehab cost.

It is important to never lose sight of your after-repair value (ARV), the value of the home post fix. Your ARV will not only help you determine your rehab budget, but also how much you are willing to pay initially for the property. Most experts agree that to profit from the project, you should bid no more than 70% of the price for which you believe you can sell the property. But remember to factor in what it will cost you to fix up the property.

There is no doubt there is much money to be made in the fix-and-flip market. And lots of factors will determine whether or not you are successful. Contact the RLG team today to schedule some time to discuss how RLG’s vast experience in the sector can help guide you to success.