Real Estate Investing Forums

Real Estate Investing => Rehabbing, Fix and Flip, Rental Properties => Topic started by: abrei on January 30, 2005, 06:47:27 pm

Title: Investing in a low appreciating area
Post by: abrei on January 30, 2005, 06:47:27 pm
The community where I live in is considered a retirement community with an average yearly appreciation of 1.5 -3 % a year.  The biggest employer is a military base and a few hospitals.  Its been like this for years.  Would it be wise to invest in a single family or multi-family in this kind of market?  Prices are still low at the moment but I do not see any improvements in appeciation rate in the immediate future.  Thanks.  
Title: Re:Investing in a low appreciating area
Post by: tedjr on January 31, 2005, 12:24:01 am
Howdy Abrei:

I too am looking to invest in a similar area near Austin. Killeen has a huge base but the prices are low there because of the war right now. I do see appreciation for the future when the war is over. At the moment duplexes are selling in the 30's and rent for $600. Even at these depressed rates they will still cash flow when rented. I can still make the payments even with one unit leased. Perhaps your area is near the same.

LOL
Title: Re:Investing in a low appreciating area
Post by: Bud Branstetter on February 01, 2005, 01:43:50 am
When you have low appreciation you need to make your profit going in.   Like Ted is doing the profit is cash flow even if it never sells for more.

You do it easiest with motivated sellers.  You can leverage using owner financing or subject to but you still want your profit upfront, along the way or at the end. All of them is best if you can get them.

You do not put up cash to buy at market prices without appreciation.   Use an option.  Isn't subject to a form of an option.  Isn't owner financing a form too.  You just have it that there is no recourse on you personally, only on the asset.
Title: Re:Investing in a low appreciating area
Post by: dwj469 on February 06, 2005, 04:43:56 pm
If you are buying to rent out to tenants then it is great because you get that positive cash flow. Appreciation is just an added bonus. Our population is growing by leaps and bounds every year all those people have to go somewhere right? Even if in many years from now you sell the property for the same price you bought it for you still make a great profit on all those rent payments as well as the tax rights offs to go with it.