Being an Huntington Beach Real Estate expert I get lots of questions about real estate market in Huntington Beach and also the Orange County Real Estate market as a whole and if there are any good investment opportunities. People commonly ask me what makes a good investment property, and what they should look for in purchasing an Huntington Beach or Orange County property for investment purposes. Below is a list I put together of three things you should look for before you get started.
The most important part of choosing an investment property is the location. You need to know your location as well. Know the ins-and-outs of the community. For instance, if you are from Costa Mesa – you should look for Costa Mesa real estate to invest in first. As you know that area the best. If you choose a great location for your investment property you open up a plethora of options for the future. For example, let’s say the building on your property is not in great condition but your still making money each month and continue to build great ROI. You can then save money each month to reno the property. This could really double the value based on the location of your property. If you have a undesirable location the renovations to your property will only add minor value to the overall rent income and/or property value.
The second factor you want to look for when choosing an investment property is how much revenue each month you will be receiving from renters. You want to make sure you know that number before you purchase the property. Make sure after your: mortgage, taxes, and insurance is paid for each month your still making money. Never buy a property that you will take a loss on each month in the hopes to, one day, reno it and make a profit. Sure way to go bankrupt.
Third you want to look at the property condition. Sometimes you can get a really great deal on the property because it is in poor condition. If that is the case I would seriously consider buying the property and renovating it but only if the property is in a great location. Also, I only recommend doing something like this if you are construction savvy or know someone who is.
Make sure that you are not over paying for the property. Look at the comparables in the area to see if the cost per square foot is the same or better for the property your thinking about purchasing. Only use the cost per square foot method to see if your getting a good deal. A common mistake is looking at a property and because it’s fifty or hundred thousand dollars less then everything around doesn’t mean your getting a good deal. Example, lets say your thinking about buying a downtown Huntington Beach home for $700,000 and its 1500sqf. A normal price for a HB down town home is close to $1,000,000. However, your paying for the $700,000 home is really $467 per square foot and the downtown avg is roughly $400 per square foot. Your actually overpaying tremendously for the home.
Quick Tip: Some of the best deals I am seeing right for investments are Huntington Beach townhomes and condos. Take a long hard look at this market. A lot of properties I am seeing will cash flow immediately and it’s the cheapest way to get into the investment or flip game.
If your thinking about buying/selling: Orange County, HB or Costa Mesa Real Estate for residence, or investment purposes, contact me! I guarantee to guide you through the difficult process to get you the best property for the best possible price. Text or call me directly at 714-655-1627.