Investment Checklist

Who shouldn’t invest in property?

Property is not like buying penny stocks that offer the possibility of doubling your money over night. Property is the slow and steady play to getting rich and retiring. Having said that, at least your investment property won’t vanish into thin air like many stocks do. You need five year thinking. As we said this is not a get rich quick scheme. Property investments should be measured in years, not months. And although your investment property can be sold and turned back into cash at any time, the best returns will only be realized by patiently selling after a number of years or more. If you are likely to need your money back in a hurry or within a year or two, then we recommend you do not invest in any property. Nickel and dime thinking will not work. If you fret over every little expense and what it is doing to the bottom line, then do not buy properties because there are always little expenses. Out of sight BUT not out of mind: If you build your property portfolio in multiple locations (as we suggest) it may not be easy to regularly view/check on your investment which can cause some people angst.

What types of property(s) should you invest in?

We offer Single Family, Attached Single Family, Duplex, Triplex, Quads and Townhomes. If you’d like to discuss the pros and cons of each type with us, then set up a phone meeting using our contact form

What demographic target should you aim for ?

Again everything has pros and cons. We’ve chosen to supply new properties in higher income neighborhoods because we can’t be bothered trying to chase higher returns from older properties in the hood. Of course the people who do buy old cheap properties swear that’s the way to go.

What type of investment return are you looking for?

For example higher cash flow will often be at the expense of capital gain.

If high capital gain is the requirement

Timing is important. Right now we’re buying the last of the legacy lots from pre-crash. Once these lots are all used up (end 2016/2017) land prices will jump $25k or more, that being the cost to develop bare land today.

Summary: Buy now if you’re chasing capital gain !

Understand the city, economy, vital stats etc where you’re investing

Even if you’re buying investment properties from other suppliers in other cities, take the time to become very familiar with all the economic data for that city. As an example of what we look for, here are some write-ups for cities we’re interested in. Charlotte NC Salisbury, Charlotte, NC Columbia SC Memphis TN

Basic Economics

Further to the last topic suggesting you carefully research economic data for a city, here is some advice on the subject in more detail.

A basic understanding of micro and macroeconomics is very helpful. Micro being local employment, infrastructure, city population and recent changes in population (i.e. trending up or down) and macro is the economy at large. For example an investment in Europe might be risky right now while they continue discussing the collapse of the Euro or chnages in US trading policy that could affect inflation and interest rates.

Other topics/subjects to be familiar with:

  • S&P/Case-Shiller Home Price Data
  • Areas that are impacted by cold or tornadoes etc. for repairs, heating, mould etc.
  • Property taxes and state taxes
  • Check inventories (houses for sale i.e. stock levels)
  • Median house prices (Be careful they are not skewed by foreclosures. Try to get median house prices for any area excluding foreclosures)
  • What are average listing times until sale?
  • Get job/ employment data–be careful not to get data skewed by seasons
  • How far to the local schools? How good are they? – Rents are often an indicator
  • What is the primary industry / employment in the area?
  • Watch for seasonal adjustments and fluctuations that naturally occur
  • Average rent paid in neighbourhood – rising or falling?
  • Median income levels
  • Employment is a) stable b) rising/falling last 2 years c) less than nation average 10%