Beachfront Property Guide » investment property

Investment Properties: How to Make Great Money in a Down Market

Jack — Wed, 20 Oct 2010 07:25:17 +0000

Unfortunately for many people there hasn’t been a worse time in recent memory to be selling your home. But, fortunately for you if you’re in the market for investment properties there hasn’t been a better time to be finding some great deals! While buying investment property while it seems every day brings headlines of more foreclosures and woes in the housing market, if you’re looking at it in the right mindset, you should see nothing but opportunity, especially if you’re trying to find homes for cheap in a foreclosure auction

Why Is This a Good Time for Buying Investment Property?

So, why is this such a good time to invest in the real estate market? There are two main reasons, low interest rates and a cyclical low in the housing market.

Low interest rates: Unprecedented Federal Reserve action has led to interest rates that are at near historic lows in an attempt to get people buying more property and other assets. By taking advantage of low interest rates from your bank, you can invest in property with a loan at rates you could only dream about a few years ago!
A Cyclical Housing Low: Just like the seasons, the housing market always goes through price fluctuations. Right now, prices are at inflation-adjusted lows compared to other housing bottoms. While it remains to be seen when housing prices will recover, they always have in the past and you shouldn’t think this time will be any different. This is the perfect time to buy low and sell high longer down the road.

So what do you need to actually make money in this market?

Right Mindset

The first, and most important thing that you need if you want to make money by investing in beachfront property, or any other kind of investment property is the right mindset. Buy homes and other properties to make money over the long term, not to get rich quick overnight.

It’s no secret that the days of flipping houses overnight for huge returns are over and nobody knows when the strength will return to the housing market. However, if you’re investing with a very long time horizon, it really doesn’t matter if we are in the bottom of prices or still in a declining phase. When prices do turn around you will have a nice return on your investment, but you’ll need the right mindset to ride out the downswing.

Right Finances

While there are ways that you can use other people’s money to start your investment property business, you really need to make sure that your finances are in order before you start looking for homes. At a minimum, you need good credit and a 20% down payment to get a good loan. This is important because the better the terms of the loan are, the more you will ultimately make on your ROI. One great way to find out if you’re getting the best terms on investment property loans is to check out a website like , which allows you to compare rates from many different lenders at once. Getting started with Lending Tree has never been easier either! Just start by putting in your details below:

Another important consideration is that you will need money on hand that can pay for repairs to the property and to also cover any unexpected vacancies. If you don’t have this covered, even a slight dip in the market can completely break your fledgling business.

Find the Right Towns and Communities

The next step in buying investment property is making sure that you are choosing property in the right communities. Real estate is essentially a local endeavor, so every town or city will have different reactions to larger market movement.

The biggest determinants in property values are generally economic vitality and population growth. Make sure you look at these numbers and try to think about what is attractive about the city or two as well before you look at any property. Also make sure there aren’t any run down homes in the area and look at how fast houses are selling on the market. If houses are taking six to 12 months to sell, the market is moving extremely slow and you might be better off finding property elsewhere.

Locating the Right Property

Now that you’ve narrowed down the areas where you want to search, you have to determine which investment property for sale is the one that you will ultimately buy. First, start by doing your own due diligence on the property. Look at how much work is needed and what condition the house is in. Also try to calculate the cash flow of the property and the ROI you can expect.

The most important part of this is the price that you ultimately end up overpaying. While houses are sometimes passion purchases, most investment properties are bought after careful analysis. If you’re the sucker that buys the property for more than it is worth, you most likely won’t end up finding another one that will be willing to pay more.

Fortunately, finding great properties for less than market value has never been easiers. With the help of , you can search nationwide for foreclosures on all kinds of properties that you can use for investment. To get started, but in your zip code below.

Take the Help of Others

Finally, don’t be afraid to let others help you during the process of finding and closing on real estate investments. If you want to get a deal done right, odds are you will need almost a small army of specialists to help you. Here are some of the most important people you will have to have help you:

Real Estate Agents: Will help you analyze and pick out properties
Attorneys: Can help with paperwork and making sure that all the legal papers are in order
Contractor: To make repairs to the property
Appraiser: To help you determine the fair value of the property
Inspector: To make sure that there is nothing fundamentally wrong with the property before you buy it.

All in all, there has never been a better time to enter the market for investment property. If you have the right mindset and look to the long term, you can make sizeable gains over time through a combination of renting out the property and appreciation.

Common Pitfalls When Buying Oceanfront Land

Jack — Thu, 04 Feb 2010 01:07:00 +0000

Posted in Beachfront Homes, Buying Beachfront Properties

Buying undeveloped oceanfront land and building a house on it can be a great, more cost-effective way to obtain your dream home. Not only is it generally cheaper, but you get a new house that’s made to your specifications and that will be exactly what you want. You won’t have to worry about aging siding, shoddy construction, or cracked foundations because you will be able to decide what types of materials and construction methods are used to build all the different rooms of your homes. Before you jump right in though, there are a few basic pitfalls that you need to avoid so you don’t end up with a property lemon – one where you can’t build your home and you find it increasingly difficult to sell.

Know Why the Property is for Sale

The first thing you need to know to make a good purchase of land is to know why the property is for sale and why the previous owner didn’t develop it. Ocean front property is a scarce resource, especially in tourist hot spots, and finding land that isn’t developed is even rarer. Find out why other beachfront land was developed while this land wasn’t. It may be because the owner never had the time or money to do it or the property was recently split off from a larger tract of land, but you do need to watch out for a few things.

First, there may be local zoning restrictions on the property preventing any construction from taking place on it. It could be in a key watershed area or the home to the breeding ground of an endangered species. Find this out at the local zoning board before placing any bids for the property. Also have someone come in and examine the property. There may be sinkholes or the ground may be so unstable that it won’t support the heavy foundations of a home. Make sure you’re not spending a fortune to build a home on sand. Finally, there may be problems with shoreline erosion. If the shore is eroding around the property, soon the home may be too close and have to be moved or succumb to the tides.

Make sure that you find out all the answers to these questions before seriously considering buying the property.

Look For Local Utilities

Another reason that a oceanfront property may not have been developed is the lack of local utilities. Make sure that the property is close enough to, at the very minimum, electric and water lines and has sewer access or can have a septic system installed. Cable TV, internet, and gas lines are also near essentials, especially if you plan on living in the house full time or renting it out. In properties that are close to other developed areas this may not be a big problem, but if you are looking at more secluded beachfront property, always check this, otherwise you might find yourself digging trenches in the backyard and reading by candlelight!

What Other Potential Development Might Take Place

Finally, when you’re deciding whether or not to buy a certain beachfront property, always try to think about what other development might take place on the land around yours. While you won’t ever be able to know for sure, inquire about who owns the land around yours. Is it owned by other single-person landowners with homes on it? Or is the beautiful coastal forest behind your property owned by a large hotel chain that is eyeing permits to develop it?

Some development can be good for your investment, especially if it places your property closer to nightlife, shopping, or other attractions, but some development may be bad, particularly if you were hoping for a more quiet atmosphere yourself. Always have an eye on the future.

Buying oceanfront land for sale to build your dream home on can be incredibly rewarding. You’ll get to see your dream home sprout up exactly the way you want it without having to make any sacrifices. However, before you can do this you have to make sure that the property is able to support a home. By following this advice you’ll be well on your way to making sure that you can build a home on the land you purchase.

Beachfront Properties: Should You Rent Them Out?

Jack — Mon, 28 Dec 2009 04:13:44 +0000

Posted in Beachfront Homes, General Beach Homes

One of the easiest ways to make a return on your beachfront property, or just to earn a little bit of extra money for it, is to rent it out for certain times of the year. Whether you are looking to buy the property as an investment and rent it out full time, or would just like to keep your house making you some money when you’re not around instead of letting it sit empty, there are several things that you need to think about before renting out your beachfront properties.

The first thing you should do before deciding to rent a property out is to get acquainted with the local housing market. This is especially true if you are buying the property as an investment and want to rent it out full time. In some areas, beachfront property prices have dramatically outpaced the prices that people are willing to pay for a rental for a week. This results in rental prices that won’t actually cover the mortgage and upkeep costs for the property. Beware of this if you are planning to be making a profit off of your beach home.

When you are doing this, it would be advisable to talk to a local real estate agent about the different opportunities for rental in the area. They will be able to tell you about how much a property like yours will rent out for and the different costs and fees that will be associated with renting your property out. On top of having to pay the normal maintenance costs for your home, when you rent out the property the real estate agent that you use will most likely get a cut, you will need to hire a maid service to clean it after the guests leave, and you will most likely need to invest a little more in things such as sheets and dishes.

Next, before you decide to rent out your home, get familiar with the local and state laws that govern rental properties. Some states place restrictions on properties that are rented out so that the owners can only stay in them a few weeks a year to perform maintenance. If you’re planning on making lots of visits down to the beach, this might make you choose not to rent your home. Also make sure that you’re not running afoul of any building codes. Many times homes or condos that are used for renting will need to have additional safety features, like frequently tested smoke detectors and fire extinguishers that allow the local authorities to come into your home and check if they are up to date. If privacy is a concern of yours, this may also make you a bit more wary to rent out your vacation home. Insurance on homes that are used to rent can also be higher than on homes just used as residences.

Renting out beachfront properties can be an extra source of income for people that have the money to invest in property by the beach. Just make sure that are well aware of all the rules and regulations that your house or condo will be subject to and that the revenues from the renting will be enough to cover the costs of owning if you’ve bought it as a strictly rental property. Only you will be able to know if the costs and benefits of renting our your property will be worth the costs associated with it as well.

How to Find the Perfect Beach Front Property

Jack — Sun, 27 Dec 2009 23:56:13 +0000

Posted in Beachfront Homes, Buying Beachfront Properties

Finding the right beach front property can be incredibly hard. There are so many locations, real estate agents, and other factors to choose from. But, by doing careful research and making sure that you have examined everything to do with the house, you will be able to find the beachfront property that you want in no time.

Examine Your Budget

The first major aspect that you have to consider when attempting to buy beach front property is your personal budget. How much money you have available to spend will dictate where you can live, what type of house you can buy, and how close to the beach you can get. For most of us, this will limit our choices somewhat.

Never try to buy a home that is out of your price range or that you would feel uncomfortable making the loan payments. If the subprime mortgage crisis of 2008 taught most Americans anything, it’s that you can’t have your cake and eat it too. Also, and perhaps just as importantly, keep in mind that mortgages are not the only upkeep costs that you’re going to have to pay on your home. You may have to furnish it, pay taxes, maintenance, and insurance. Once again, depending on where you live these can be very significant costs.

Know the Area

If you’re buying this oceanfront property for your personal use, especially if it’s for use as a primary home, make sure that you know the area very well before you decide to make a significant investment in it. Even if you have been to a town a few times during tourist season, once everyone leaves, the town can become completely different and show you a new, more unlikeable face.

Also make sure that you are able to take the climate. For some people, the tropics may be good, even great, for a week, but when you’re down there longer, you can start to notice other things than the ever present sun, like the bugs, common rain showers, and the humidity. Also make sure you know how much extreme weather you are likely to have to encounter. Hurricanes are an all-too common phenomena in many Caribbean locations and the threat of them can greatly drive up your insurance costs, making your dream home ultimately unaffordable. On top of hurricanes, there may be other, more severe storms that blow in off of the sea, or monsoons or dry spells to deal with depending on your location.

Keep the Local Housing Market in Mind

Especially, if you’re buying this home as an investment property, make sure that you are intimately familiar with the local housing market before you make the plunge. In many areas prices for housing has outstripped rental prices in recent years. This means that you could find yourself in many places earning less in rent each month than it takes to pay for upkeep on the actual property. If you needed this money to make the mortgage payments, you could find yourself high and dry sooner than you think.

Using the services of a trustworthy local real estate agent can help you greatly in this, as they will be aware of the recent trends, what’s working for investment or rental beach front properties, what areas are good deals, and what areas have been jumping up in price recently.

Inspect the Building

Finally, always inspect the building and the areas surrounding it for how solid the construction is and how likely it is to corrode in the sea air. If at all possible, have a certified architect inspect the building to make sure that it doesn’t show signs of premature wear and tear. Also make sure that all the plumbing and drainage around the house are up to your standards.

Finally, when you’re inspecting the house, don’t forget to look at the land around it, especially if you are buying property right on the beachfront. See how high the tides are and inquire about what the waves are doing to the shoreline. Are the eroding the beach to the point where you soon will have your house in the ocean instead of bordering it? Is there enough vegetation in the area to protect your new home and the shoreline from winds, rains, storms, and high tides? All this needs to be taken into consideration.

Finding the right beach front property for you does not have to be incredibly difficult. Just make sure that you do the research that’s required, inspect the property before you buy it, and know what you are getting yourself into. By following these steps, you should find yourself with a new beachfront home, vacation house, rental, or investment property in no time.