 1) Choose a property that fits your investment strategy.
We have a constant inventory of great cash-flow investments. Properties range from $35,000 - $90,000. Do your research, and then make an objective decision based on the numbers. You can find full pro-formas for all of our properties on our website at www.homeencounter.com. Click on Investment/Property Management then click on Income Properties. You will be purchasing properties at 50-60 cents on the dollar of current appraisal value. Our investment properties provide a Cap Rate between 9-11%. These are real numbers!
2) Choose your purchase strategy.
There are great options for cash buyers as well as buyers looking to purchase with lending. Right now the best financing options are with refinances. Typically a refinance can be done after 6 months of ownership to allow for title seasoning, however guidelines are constantly changing and we will keep you abreast of all opportunities to finance or refinance your purchase. For those who purchase 5 properties or more, there may be commercial refinance options as well.
3) Close on the property
If you are local you can come directly to the title company to sign the closing package. If not, the closing can easily be handled through email and Fedex. The title company will email the closing documents that you will fill out and send back in the mail via Fedex. Any funds due from you can be wired from your bank to the title company. We will guide you and assist you throughout this process to ensure that it is easy and hassle-free!
4) Begin the renovation
Renovation budgets range from $5,000-$15,000. The goal is to make the properties marketable rental homes that meet rental housing code standards while not “over-rehabbing” the properties. The properties usually need a full cosmetic and mechanical makeover which frequently includes items like: new carpet, paint, appliances, A/C system, general plumbing and electric repairs, roof repairs, landscaping, fencing, kitchen upgrades, bathroom upgrades, drywall repairs, and lighting replacement. Renovations typically take 3-6 weeks to complete.
5) Set up your property management.
We provide full service property management to ensure that your property is managed efficiently and effectively. Our property managers are experts at marketing and managing these properties. When we screen and place a qualified tenant, we charge a one-time placement fee of half of one month’s rent, and then a monthly management fee of 10-15% of gross collected rents. We send you a check and detailed statement on the 2nd Friday of each month to report to you activity for your property. We also work closely with the local Section 8 offices and try to occupy as many properties as possible with government assisted tenants. This helps ensure full and timely collections of rent which is the driving force behind your investment.
6) Exit strategy.
You are buying a great investment at a great price. There are a lot of great investment options in the area right now due to foreclosures and short-sales that are taking place. Due to the state of the current market, we recommend that investors maintain at least a 4-5 year time horizon in order to maximize the income potential for their investment. During the course of this time, we will help you identify the best exit strategy and the appropriate time to sell your properties. We will market your properties for sale in a similar manner as we marketed them to you for purchase using a wide array of web and print marketing to groups of buyers around the world as well as local families seeking to own a home. In a conservative scenario, these properties will sell for roughly 150% of your total investment. In other words, if you invest a total of 60k you will sell for 90k in 4-5 years. This assumes that prices are based on current market value of the home today, however you are likely to see a good amount of appreciation above this benchmark value.
For more information on our investment Strategy, contact Chase Clark by clicking here or calling 813.425.2566.
FIX & FLIP • INCOME PROPERTIES • HISTORIC RESTORATION |
