Real Estate Investment Strategy

In order to get the best return on investment for a distressed real estate purchase one must consider many factors. These details include but are not limited to, the current and future state of the housing market for a given area, the cost of construction and related services, the median rental, lease or sale prices, the property taxes, the title cost and insurance, as well as any legal implications of the purchase and subsequent sale, lease or rental. Most importantly one must pose the question, “What is it that I hope to achieve from investing in a distressed property?”

Provided the sum of $150,000 I would choose to invest in the Las Vegas housing market, because it is where I currently reside, and second because it is one of the hardest hit by the economic downturn and therefore has vast inventory from which to choose. Despite the toll of unemployment and its consequential effect on the market, Las Vegas has a steady group of resident and visitor that will undoubtedly rebound in the coming years thereby making it a sound venture.

The first order of business is to ally with a professional real estate broker that has comprehensive knowledge of the Vegas market, Nevada real estate laws, and some experience with auction, foreclosure, and distressed properties. To fill this role I would choose from a stable of trusted family members that are licensed Nevada realtors whom have no vested interest in the distressed properties.

The next step in the strategy would be to research and retain the services of a qualified home inspector for thorough analysis and evaluation of the realty. Following which I would determine three to four contractors to call upon for bids on repairs and upgrades for the homes. Finally, I would consult a c...

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... investors of the world, Warren Buffet, the critical investment factor is determining the intrinsic value of property and paying a bargain price. When all is said and done the value of the property following the investment must far exceed the total cost. Whether the value is in real capital future return, or personal growth or gain.

The property or properties must provide a place for the investor to live in and garner profit in the future, or create cash flow in the form of monthly rent/lease payments to cover mortgage and potentially add to profits. The correct strategy, detailed budgets, quality products and workmanship along with the due diligence of the investor can turn a $150,000 dollar investment into a short term return of three times that amount or a long term yield of millions for the investor who is willing to put in the time effort and determination.