10 Keys to Success for Real Estate Investment Purchases in Tampa
Investing in real estate in the Tampa Bay area has always been a popular choice, but interest has exploded in recent years. This trend doesn't
show any signs of slowing down either. Buying real estate is more than just purchasing a place to call "home". It has become a common and very popular
investment vehicle. However, it's a lot more complicated than investing in stocks and bonds. Having the right company to help you navigate those waters
is critical to turning your hard earned money into positive cash flow every month. Here I will share with you 10 keys to success for investing in real estate for the Tampa Bay market.
Rental Properties
At NJS Realty this is our specialty! I have been helping investors purchase and manage rental properties in the Pasco and Tampa areas my entire career. The
practice is simple on the surface. You buy a property, make sure it's in good condition and rent it to a tenant. You as the owner/landlord will be responsible
for paying any mortgages, taxes and costs to maintain the property while hopefully you are charging the tenant enough rent each month to cover these costs.
If you've done everything right you should be seeing positive cash flow each month and a healthy appreciation in value on the property itself. Sounds simple right?
Let's take a closer look and what it really takes to achieve all of this...
Location, Location, LOCATION!
OK, we've all heard that myth before and while it is an important factor in all real estate it's far from the only aspect we will be focusing on here at NJS Realty.
- Neighborhood: Knowing which neighborhoods the local tenant base is looking for will influence many key factors in your return on investment (ROI).
I have spent years researching the local market to know exactly what areas perform best to maximize ROI and reduce vacancies so you can keep more cash flowing every month.
In many cases this knowledge is down to the street level or knowing what neighborhoods will even allow rental properties in the first place. This type of local
knowledge is invaluable and can only come with the type of experience we have to offer you in the Tampa Bay area.
- Job Market: It should be no secret that the closer you get to the major metropolitan areas the higher concentration of jobs you find. You also find a higher cost of
living which means, yes, higher prices for homes. What if you could find those locations that have a growing employment trend AND a cost of living that reaches a broader
tenant market? These statistics are readily available at your local library or from the US Bureau of Labor Statistics if you have the time and patience to
figure out how to make sense of it all. Luckily for our clients at NJS Realty I spent over 9 years writing the software for the government that interprets all of that information. Does any other real estate firm have this knowledge of how that software was written and how to interpret the data?
- Schools: This is one of the factors that is often over-looked. Finding a quality investment property in a good
school zone will not only help keep your property rented but will also increase equity for years to come. We have the tools to help
you make the educated decision.
- Crime: Statistics on crime is a tricky one for any licensed real estate professional. We are bound by federal and state laws that
say we cannot steer clients as that would violate Fair Housing guidelines. What we do at NJS Realty is make sure that all of our clients
are armed with the proper tools to feel confident that the investment properties they purchase are going to meet all of their needs.
- Property Taxes: When analyzing any investment property you have to consider all of your operating expenses. There's no
getting around it, you have to pay your taxes! However, property taxes are not standard across all markets or even across different neighborhoods
in the same city. Two identical houses that cost $100k can have vastly different returns each year solely based on operating expenses. We
give you that information to the best of our ability for every potential property.
- Property Characteristics: Also known as functional obsolescence, having this information inline with what people are
actually looking for will mean the difference between a property that rents fast or one that sits there for months! There is no hidden science
behind this; you either know your local market or you don't. Unless you've managed hundreds of properties in the Pasco and Tampa Bay areas there's
simply no way to truly know what characteristics tenants find most appealing.
- Supply and Demand: If there is an unusually high number of listings for one particular neighborhood,
this can either signal a seasonal cycle or a neighborhood that has "gone bad." Make sure you figure out which it is before
you buy in. You should also determine whether you can cover for any seasonal fluctuations in vacancies. Similar to listings,
the vacancy rates will give you an idea of how successful you will be at attracting tenants. High vacancy rates force
landlords to lower rents in order to snap up tenants. Low vacancy rates allow landlords to raise rental rates. It can be a
critical balancing act.
- Natural Disasters: Florida in general is no stranger to acts of nature. That doesn't mean
you shouldn't invest here. It means you need to find someone to help find you the properties that mitigate these risks as much as possible.
Again, there's no book out there that explains the areas least affected. You need a real estate investment agent that knows the Tampa area.
- Property Condition: Article 2 of the REALTOR© Code of Ethics and Standards of Practice clearly states that "REALTORS® shall not,
however, be obligated to discover latent defects in the property, to advise on matters outside the scope of their real estate
license, or to disclose facts which are confidential under the scope of agency or non-agency relationships as defined by state law." This is great!
I wouldn't want anyone telling me a house is in great condition unless they were qualified to tell me that either. We have licensed and reputable property inspectors standing by ready to help that we have used for years.
- Rents: At the end of the day this is the number one question we get here at NJS Realty. How much will my property rent for?
This is the culmination of everything we've already talked about here and only through diligent research, tried/tested tools and invaluable local market
knowledge can a reasonable expectation be given to this question. We are intimately tied to each and every investment property we help our clients acquire
because are most likely managing that property as well. We succeed only when you succeed so we put our name on the line every time we give you one of our
custom Investment Analysis Reports.
I'm SOLD! What next?
We have developed an industry exclusive 12 Step Action Plan for Real Estate Investment that no other company is able to offer. It takes the
guess work out of what could otherwise be a daunting and confusing process. We will create a custom search engine based on criteria that we gather from you which is constantly refined
to ensure we are on target with every property we preview. Our process is flexible enough to handle any client's involvement ability. You don't have to be living
in the Pasco or Tampa Bay areas to take advantage of its investment opportunities. I've managed investment acquisitions for clients all over the world and I'm confident we can be successful together.
