Finding the Best Deals: Top 5 Cities for Investors
Investors have accounted for a greater bulk of real estate transactions in recent months as they’ve looked to snag some of the ultra-low prices from distressed sales and other properties. In fact, investors are expected to outnumber traditional home buyers three to one in the next two years, according to a recent study by Move Inc.
Inman News recently conducted an analysis of hundreds of real estate markets to determine the top markets for real estate investors, taking into account such factors as the median sales price, loan data, foreclosure sales and discount statistics, population, and unemployment data.
Here are the top five cities that Inman News found as the best real estate markets for investors:
1. Indianapolis-Carmel, Ind.
2. Winchester, Va.-W.Va.
3. Gainesville, Fla.
4. Tuscon, Ariz.
5. Tallahassee, Fla.
View a complete list of the Top 10 cities for investors at Inman News.
In its analysis, Inman also found that 52 percent of the investors surveyed said they would be “somewhat likely” to buy another investment property or vacation home in the next two years.
Source: “10 Best Markets for Real Estate Investors,” Inman News (June 3, 2011)
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Vacant Lots Become Hot Property
Vacant residential lots are looking better and better to real estate investors.
The cost of a finished, ready to build lot, can cost a developer about 25 percent of the finished home price. There are a number of these ready-to-go lots on the market at about half what they actually cost to prepare. Investor groups are snapping them up, figuring that the time will come soon when they will be in demand.
“The country needs 1.2 million new units for the next 10 years just because of population growth,” says Scott Clark, president of American Development Partners, which has bought thousands of vacant lots all over the West. “[U.S. builders] built about 500,000 units in 2009 and 600,000 units in 2008, so there eventually will be pent-up demand. We want to get as many of those finished lots as we can because as demand begins to rise, the need for housing will become painfully obvious. The delta (ratio of change to value of underlying asset) in this investment will be significant.”
Source: Inman News, Steve Bergsman (02/12/2010)
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Low Prices Draw Investors Back to Market
Real estate investors are moving back into the market, according to a new survey from Move.com.
According to the Move.com survey, 12.1 percent of home buyers today plan to buy a home as an investment property, compared to 5.6 percent in March 2009. The survey found that 15.8 percent of those interested in investment property were men and 8.1 percent were women and 52.6 percent of the investment buyers were between ages 35 to 49.
Of the 25.3 percent of buyers who are focusing on foreclosure properties, 42 percent regard the purchase they are considering an investment and don’t plan to live in the property themselves; 13.2 percent plan to rent out the property; 11.3 percent are going to fix up the property and resell it; and 17.4 percent plan to house a family member until the property can be sold profitably.
Of the 9.8 percent of buyers who say that they plan to purchase and live in a property in the next two years, 5.4 percent plan to purchase in the next 12 months; 48.3 percent are first-time buyers; 52.8 percent are women, and 44.1 percent are men.
Buyers of investment and personal property say they are motivated by these factors:
* Prices are as low as they will go, 23.6 percent
* Foreclosure prices are a bargain, 18.7 percent
* Great selection of homes for sale in their target community, 21.2 percent
* Concerned interest rates will rise, 14.2 percent
Source: Move.com (11/11/2009)
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