Profitable Investment Properties November 15, 2009
Posted by janey in : second mortgages , trackbackAt one time, investment properties were the secret to creating a sound retirement foundation and creating a steady stream of supplemental income. Many Americans paid off their mortgages and invested in rental complexes or began flipping houses as a way to bring in extra capital. For years, this worked beautifully… until the housing market crashed. Yet, do not be fooled by the doom and gloom, for an opportunist sees even greater possibilities. The large inventory awards potential investors deep discounts and, with many markets poised on rebounding, it’s never been a better time to invest in real estate, so long as you do it wisely.
One type of profitable investment property is the vacation home market. Many investors look into overseas property where conditions are favorable to American investors. According to the Association of Foreign Investors in Real Estate, a non-profit trade group, some of the best foreign places to invest are safe bets like London, England; Paris, France; Shanghai, China; Tokyo, Japan; Singapore; Munich, Germany; Sydney, Australia; and Hong Kong. The idea with buying investment property overseas is that you must look for location, location, location! Choosing a safe, industrialized city, which sees a good deal of tourism each year is a smart bet. Many investors also like coastal beach properties to rent out as well. According to the editors of Live and Invest Overseas Magazine, the top coastlines to check out are: Veraguas (Panama), the Samana Peninsula (Dominican Republic), the Rocha province (Uruguay), Salinas (Ecuador) and Boracay (Philippines).
Creative real estate investment properties include mixed-use buildings, which are becoming more and more popular nationwide. Instead of purchasing office complex investment properties, a buyer would purchase a building that contains office space, condo/apartment/hotel units, restaurants, shopping facilities and entertainment venues. Since there are different types of businesses in mixed-use buildings, the space is more likely to weather any kind of economic storm. Los Angeles engineer Wayne Kalayjian says that mixed-use is an emerging movement and cultural shift, not just a passing trend. “Under this concept, our homes, shops, offices and transportation centers are more integrated and in close proximity,” he says, “which decreases commuting time and expense, conserves energy, heightens quality of life and enhances a feeling of community. And it’s particularly attractive in our suburbs, which are especially susceptible to urban sprawl.” The ideal location for such US property is in a thriving metropolitan city or active suburban community, where a lot of people live, work and play.
Often times, investment properties are run-down buildings sold at dirt-cheap prices by people who are skilled in flipping houses. In the past, this has been a way for property owners to score huge profits. They usually repaint, update the bathroom and kitchen, re-carpet or install wood flooring, slap a new front door on the house and sell it for three or four times’ what they paid for it. Yet the primary factor for housing is still location. You will also have to have a realistic assessment of what you’d pay for the renovation projects and what prospective buyers will pay for the property. Investing in real estate shouldn’t be done on a whim, but rather with thoughtful preparation.
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