As mentioned last week, real estate investment must achieve positive cashflow. The success key factors are: Buy low, sell high and managing positive cashflow. How do investors manage these techniques to ensure profitability? In the next few weeks, I will use single family 3 bedroom, 2 baths & 2 storey rental property as our example to illustrate these points.
How do investors find properties at rock bottom price in rentable conditions?
To build a brand new home of these features, with above average finish, the cost is at least $120-150 per sqft. This is wholesale price for builders. Of course they markup their prices based on what they can get in the market place. In today's red hot Canadian real estate market, especially major metropolitans of Alberta, BC and Ontario, resell houses of these features are priced at double, triple or quadruple of the cost to build.
Last week, Wall St. Journal reported that Las Vegas, Nevada is the best real estate rental market in US. We take a look at the average price of homes of these features and the mean average is around $120-130k. That is $60 to $70 per sqft, significantly lower than the building cost. Due to special relationship Toronto, Canada based Millhouse Ventures Ltd. has with local banks in Las Vegas, they are able to further reduce these prices to as low as $40-50 per sqft.
To buy low, one must not only find the perfect market environment but also the perfect relationship with selling party. To read more news about distressed US real estate or find out more about Millhouse Ventures Ltd. visit www.millhouseventures.com.
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