How to Choose the Best Short-Term Investment Property

In today’s increasingly complex investment landscape, real estate is a viable and valuable resource. By investing in property, you can increase your monthly income through rent, benefit from increasing property costs, and secure a spot in tomorrow’s real estate market. But how do you know which property to invest in, and whether it will be worth the time and money?

Many investors, especially those that are buying their first investment property have these, and many more questions. We will clarify what an investment property is, the pros and cons of investing in this resource, and factors to consider when buying a short or long-term investment property.

What is an investment property?

In short, an investment property is a real estate property that someone purchases in order to generate a return. This return usually comes from rental income, resale of the property, or both. Generally, there are three types of investment properties: short-term, long-term and flip investments.

Short-term investment properties are what buyers refer to when they talk about buying a home for vacation rental income. Short-term rentals are often called vacation rentals and usually house tenants for a few weeks maximum. These properties are rarely considered for long-term living for the buyer, but instead serve as a form of supplemental income.

Long-term investment properties are usually properties that an investor buys and intends to hold for years. Long-term rentals are properties that allow tenants to stay for months or years. These properties can also generate supplemental income because the investor can rent out the property or sell it in the future for a hopeful profit.

Flip investment properties are usually bought below market then rehabbed and resold for a quick profit.

Each of these types of investment properties have their strengths and weaknesses, and it is up to each individual investor to decide which is right for them. Let’s look at the pros and cons of each type of investment property, as well as the general landscape of investment properties.

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The Benefits of a Short-Term Investment Property

In the last few years, the popularity of short-term investment properties has exploded. Thanks to vacation rental apps like VRBO and Airbnb, more and more investors are turning to short-term investment properties to supplement their income.

Short-term investment properties as vacation rentals are also a way for investors to increase their cash flow and grow their equity. Sites like Airbnb allow homeowners to rent out their space for weekend or short-term stays. Depending on where you live, this can be quite the lucrative market.

The Disadvantages of Short-Term Investment Properties

For beginners, investing in a short-term property can be intimidating and expensive! Unless you have an intimate understanding of the area, you may find yourself lacking some important resources before investing in this project.

In terms of short-term properties for vacation rentals, you never know how a tenant will treat the property and while most organizations offer some form of insurance, this can be scary for first-time investors.

The Strengths and Weaknesses of Long-Term Investment Properties

Long-term real estate investing (sometimes called “buy and hold” real estate) is another way to increase your cash flow and equity over a longer period of time. Some financial experts consider real estate like this one of the best ways to build your wealth passively. If you have the capital to spend on real estate, many of these experts would say go for it.

Real estate is not all rainbows and butterflies, though. You must consider the long-term expenses of these properties, such as paying a property management company, HOA fees, or dedicating your own resources to fix up the place. While you can control who lives in your property and how much they pay, you can’t always control what will happen to the home.

Also, long-term investors won’t see the fruits of their labor for a while. If you are planning to buy and hold a property for increased value down the road, you may have to hold it for tens of years.

The Strengths and Weaknesses of Flip Investment Properties

Thanks to television shows like Flip or Flop and a distressed real estate market flipping properties has become very popular.

The main benefit of these types of properties is that you can increase your cash reserves rapidly. For example, let’s say you buy an investment property for $100,000. You then put $20,000 of renovations into it to “flip” the home, and because of these improvements you are able to sell the property on the market for $200,000 (given that comparable houses in the area are selling for that price point). Minus the time and labor dedicated to the project, you just made $80,000 (before closing costs, commissions, etc.)

As you can see, a professional house flipper could do this a few times a year and increase their net worth substantially.

Real estate is an industry that is always fluctuating, meaning that if you flip a house, that doesn’t mean it will sell anytime soon. Your project may sit on the market for months, time during which you are incurring costs for staging, maintenance, and other expenses.

Factors to Consider When Choosing an Investment Property

Real estate is usually a good investment, but some investors find themselves reconsidering their choice to buy if they haven’t done proper research. There are many factors to consider when deciding on your property, including location, amenities, size, and of course — cost.

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Location

Location is crucial when thinking about buying an investment property, especially if you plan on renting it out on sites like Airbnb. Location can make or break a property and even if it is newly renovated and turn-key, location can turn away possible renters.

When searching, first, think about how close the potential property is to points of interest. A few questions to ask yourself when considering location are:

  • Where do tourists like to spend time? This answer may vary depending on your area. Some cities thrive on their downtown nightlife, while others offer seclusion and space.
  • Are there restaurants or points of interest within walking distance of the property? Many vacationers won’t have cars and will want to walk to popular places.
  • How much will you charge for a property in that location? You can charge renters more for a better location, but ask yourself if the increased upfront cost is worth it.

These are just a few questions to consider when thinking about renting out an investment property. If you are looking to buy a property to flip or hold, you will face different location questions, such as:

  • What are the schools like in this area? Will they draw families in or scare them away?
  • Are there parks in the area?
  • What demographic will the area attract? For example, if you are trying to attract young Millennials, you might want to consider a property closer to downtown and nightlife.
  • What is the crime rate in the area?

These questions will help you find the right location for your needs. There are no right or wrong answers, but a multitude of considerations.

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Amenities

Again, the amenities your investment property needs will depend on your goal for the property, so it’s vital to know the area and what people are looking for.

For example, if you live in a rural area that tourists seek out for an escape, it might be nice to look at properties with more acreage and distance between neighbors. These guests might not need access to public transportation, but will require a kitchen to do their own cooking.

On the other side of the spectrum, imagine a city weekend for a bachelor or bachelorette party. These guests would likely appreciate adequate public transportation and lots of place to sleep (such as pullout couches). Different properties will have different amenities, depending on your guests’ needs.

By knowing your guests and their needs, you will be able to search out properties that are right for them.

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Size

Investment properties come in all sizes, and each size offers its own benefits and weaknesses. Think about the end goal when looking at investment properties. Do you imagine a couple growing older and starting a family in your rental home? Or do you want to make a quick buck and get college kids in and out every weekend? For the former, you would look at a three- or four-bedroom home. For the latter, a two-bedroom condo or studio apartment might do the job.

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Cost

No matter what the location, size, or amenities of a property, it ultimately comes down to cost. Before considering buying an investment property, you must know how much you can spend, both upfront and for ongoing costs.

Many properties have hidden costs that a first-time buyer might not consider. For example, you may face higher HOA fees for condos, or might need increased insurance in a certain area of town. In addition, different taxes and fees apply to vacation rentals that don’t apply to permanent housing.

Some cities are limiting the amount of vacation rentals allowed in its jurisdiction, so before investing too much into a property, consult with local lawmakers and lawyers to understand your options.

Other Financial Considerations

In addition to the cost of a property, it’s important to consider other financial opportunities, and disadvantages, of investment properties. For example, vacation rentals require different insurance than long-term rentals. Banks are also more hesitant to provide mortgages to investors looking to buy investment properties, so you may need a bigger down payment, or may even need to pay in cash. Lastly, you need to consider the ongoing cost of maintenance of both short and long-term investment properties.

One benefit is that you can deduct the depreciation expense of an investment property from your taxes. This non-cash expense enables you to alleviate some of your investment property income over time without any out-of-pocket expenses.

Ready to Find the Perfect Investment Property for You?

In today’s market, with growing populations and rent prices, real estate can be a very viable investment. When looking for an investment property, consider the type of investment property you need, your goal, and what you are looking for when shopping for a place.

  • Long-term investment properties are properties that investors buy in order to increase their cash flow and rent out to tenants for longer rentals. Investors may also want to buy and hold these properties with the hopes of selling them in the future for a profit.
  • Short-term investment properties are properties that investors buy to rent out to short-term tenants. These short-term investment properties are likely to serve as vacation rentals on sites like Airbnb.
  • Each of these types of investment properties have their pros and cons. For example, a short-term property can generate quicker and higher income, but is more risky. A long-term property will take longer to pay off and may require work throughout the period of ownership, but is less risky and serves as a consistent income.
  • There are many factors to consider when looking at investment properties, such as location, amenities, size, and cost.
  • In order to find the right property for your goal, you must understand who you want to rent to and what their needs are. Younger vacationers will want different things than an older, growing family.
  • Before diving too deep into investment properties, study up on your local code on vacation rentals. Some cities limit short-term housing.

At Revestor, we help investors looking for investment properties find the right ones for them. We break down our data into long-term and short-term rentals and show users how much monthly cash flow they can expect from specific properties. Users can quickly check out how much properties are going for in their local area today.

Airbnb Host Tips

Over the past few years, there has been a surge in vacation rental platforms like Airbnb. These platforms connect vacationers with homeowners who have fixed their places up for short-term stays. Airbnb offers homes across the world, from Paris to New York City to small towns throughout the nation.

While hosting your home on Airbnb can be a great opportunity to generate some supplemental income and share the beauty of your neighborhood, many first-time (or veteran) hosts may have questions about the process. Here, we will go over some of the frequently asked questions we have heard from both first-time and veteran hosts and share some tips for making money on Airbnb by being an excellent host.

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Frequently Asked Questions

Based on Airbnb’s site and the feedback we have heard from past hosts, we have generated a list of FAQs for hosts, both seasoned and new.

Who can host a home?

One of the things that draws users to Airbnb is its flexibility, because almost anyone can rent out their home. The platform was born from the desire to rent out the founders’ air mattress in their apartment and while it has grown since then, there are still a variety of room types.

Some common room types available are shared rooms, which are rooms where the guest and host share a space, private rooms, which are rooms just for the guests, and entire homes or apartments. Depending on a guest’s needs, they have multiple options.

How can I verify a guest before they book?

Most guests understand the need for verification before booking a place to stay, so requiring this step is simple on the site. When a user makes an account for the first time, they must provide a driver’s license or other form of government issued photo ID, add a picture to their profile, and fill out some basic information. No one wants someone coming into their home that doesn’t look like who they were on the Internet!

Do I need to talk to my landlord or HOA organization before I host my home?

Yes. Every property will have different rules, so it’s important to consider your contracts and rules before hosting out your home. In addition, some city or state laws might affect your listing availability.

Talk to your landlord or HOA about how often you plan to rent out your home, how many guests you expect to have, and share with them that the site works hard to build a relationship of trust between its hosts and guests.

You also might want to speak with your neighbors about your hosting plans. They likely won’t want to wake up in the morning, grab the newspaper in their robe, and be surprised by a stranger next door. By communicating proactively, you will save yourself stress in the long run.

Can I rent my home out for longer stays, and if so what should I consider before doing so?

In most states, a stay of over 30 days constitutes as a residential occupancy, meaning that these guests can have the rights of a tenant. Airbnb suggests that if you plan to rent out your home to a guest for more than 30 days, have them sign a rental agreement. Here, you can lay out some house rules and use this in court if necessary.

Some states do not allow hosts to rent their homes out for extended periods of time. Consult your local laws and regulations before booking a long-term stay.

How and when should I communicate with my guests?

Guest and host communication is key with sites like Airbnb and one of the reasons why they have gotten so popular. Guests can experience a higher level of service than they would get at a hotel, and know that they are always speaking with a real person. You should make the effort to communicate regularly with your guests.

Make sure to talk to your guests before they book, after booking, right before arrival, and after departure if necessary. Some guests might message you before paying for their booking, but it’s important to encourage this dialogue. Before your guest arrives, make sure they know how to reach you, that they have the correct address, and that they know any entrance information like gate codes or parking situations. And remember to ask them if they need anything that would make their stay exceptional!

What is the Airbnb host guarantee?

According to Airbnb, their host guarantee “provides protection for up to $1,000,000 to a host for damages to covered property in the rare event of guest damages above the security deposit, or if no security deposit is in place. The Host Guarantee Program doesn’t cover cash and securities, collectibles, rare artwork, jewelry, pets or personal liability.”

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Tips for Airbnb Hosts

You may think that becoming a short-term rental host is as easy as downloading the app and making an account, but a lot more goes into being a successful Airbnb host. You must consider your time and resources, your guests’ comfort, and the legal implications of short-term rentals. Below are some tips for Airbnb hosts.

Accurately Describe the Location

When filling out your Airbnb profile, make sure to describe your property to the best of your ability. Airbnb offers a wide array of considerations when listing a place, such as room type, number of bedrooms and beds, location, and many others.

The more details you list about your investment property, the better. Include accurate pictures as well to help people imagine the space correctly. Make sure to include details that Airbnb might not have categories for, such as if the house has a gate code, if the neighbors have any specific considerations, and how far it is from points of interest. All these details will set your listing apart from others in your area.

Consider Guest Experience

Although you may only be renting to guests for a short period of time, consider their experience and things that might make it extraordinary. For example, some Airbnb hosts include a little snack basket upon arrival, provide newspapers or magazines for guests to read, or dress up the place with local art and other finds.

Just like when you put a property on the market to sell, when you host guests on Airbnb make sure your home is staged in a fashionable manner. Most guests, especially those looking to spend a little more on their stay, will enjoy places that look like home and are staged professionally. Invest in nice towels, linens, robes, and decor.

Price Your Property for Success

There is nothing worse than putting in the effort to buy and list a place and having no takers. If this is something you’ve experienced, it might be because your place is priced too high (or too low) for renters. Before listing your space, do extensive research to see what comparable places are listed at. If you go too high, renters won’t see the value and might choose a competitor. If you go too low, you might dilute your value and make renters weary of its quality or you might end up losing money on the deal.

Be Communicative

Like mentioned earlier, one of the benefits of choosing Airbnb over a chain hotel for renters is that they can experience a higher level of communication and personalized service. Make sure you are available before, during, and after your guests’ stay. They will likely have questions about the logistics of their stay, so make sure you have a plan in place to answer these. Airbnb makes it easy to communicate with your guests through the app or using your personal number.

Be Yourself

We’ve always heard this lesson growing up, and it still applies when hosting on Airbnb. Sure, anyone can stay at a Hilton or Marriott and know what they are getting, but being yourself is part of the fun with Airbnb. With the flexibility of renting out your space, you can decorate it to your liking and offer a unique experience for your guests. For example, if you are renting a home in Napa Valley, you could decorate it with art and wine memorabilia from the local wineries in the area. This unique touch likely can’t be found at the big, corporate hotels.

In fact, one of the requirements for Airbnb corporate hosting (when a host has multiple rooms, like a small bed and breakfast) is that each room needs to be decorated in its own way. The company avoids places that are too cookie cutter-like.

using airbnb app hosts

Using the Airbnb App

These are just a few of the ways you can plan for success when hosting your home. Now, let’s look at some tips for using the app itself so you can be prepared to rent out your investment property.

Understanding Superhosts

According to Airbnb, Superhosts are “experienced hosts who provide a shining example for other hosts, and extraordinary experiences for their guests.” Adding the Superhost designation is one way for Airbnb to reward hosts that go the extra mile for guests and to provide renters the security they are looking for during their trip.

To become a Superhost, your account must be in good standing, you must have hosted at least 10 trips in the past year, have at least a 90% response rate, receive 5-star reviews at least 80% of the time, and complete all of your reservations with no cancellations. Airbnb automatically qualifies hosts for this designation if they meet these criteria and reevaluates hosts a few times a year to make sure they are still up to Superhost standards.

Your Profile Matters

Another suggestion for using the Airbnb app, for both renters and hosts, is to fill out your profile completely. For hosts, this provides a higher level of security for your guests because they know who they are working with and get to know you as a person. Access to this information will put their mind at ease before staying at your place.

For guests, having a completed profile allows hosts to know who to expect at their home and provides them with a higher level of certainty and care. Completing your profile includes adding an updated picture, sharing your location, adding a little description about who you are, and adding contact information.

On your profile, you will also see reviews that hosts and guests leave each other. You must leave a review before you can see the other person’s review of you. Both guest and host reviews matter for the integrity of both parties.

Look for Verified Guests

When used correctly, the app can lead you to guests that are right for you. Just as guests look for verified hosts and Superhosts, hosts can look for verified guests, too. Verified guests will have all the information listed above, such as contact information and a real photo.

In addition to verification, Airbnb offers a social connection feature, which allows you to see if you have any mutual friends with a guest on Facebook, Google+, and LinkedIn. This allows guests to develop a deeper relationship of trust with any mutual friends and search for further information.

Set Yourself Up for Hosting Success

Hosting on Airbnb, whether for the first time or the hundredth time, can be an uncertain process. The app offers a lot of safety and security measures, but we answered some questions that hosts might have.

A summary of our answers:

  • Almost anyone can host their home on Airbnb.
  • The app allows a host to verify their guest before booking.
  • You should talk to your landlord or Homeowners Association before hosting.
  • You can host a guest for a longer period of time, but check with local laws before doing so.
  • You should actively communicate with your guests before, during, and after their stay.

We also covered some tips on how to be a good host. You should:

  • Accurately describe your property
  • Consider the guest experience
  • Price your property for success by not being too high or too low
  • Communicate with your guests
  • Be yourself

Lastly, we provided some useful tips about the app itself, including Superhosts and how to become one, filling out your profile, and looking for verified guests. Airbnb is a great way to generate income and involve yourself in the online community of hosts. After reading this article, you are well on your way to becoming an excellent Airbnb host!

Airbnb Marketing: How to Market Your Property

Finding an investment property, as complicated and time-consuming as it is, is just the first step in actually listing, fixing up, and renting out your place. If you are looking to get involved with a site like Airbnb, there is a lot to know about how to get started. First, you need to know how to make a profile. Next, you need to understand what a good listing includes. And finally, you must understand how to market your profile to the world in order to start making money on Airbnb.

Making an Airbnb Host Profile

The first thing you need to do to market your investment property is to create a profile on the Airbnb site or application.

  1. Go to airbnb.com/host. Click on “Start Hosting.”
  2. If you already have a guest profile on Airbnb, the site will ask you if you want to continue as this profile. If you would like to make an account for someone else, click “More Login Options.”
  3. Once you confirm your profile, the first question will prompt you to list what kind of place you have. You can choose between private rooms (the guest has their own space), shared rooms (the guest and host share a common space), or entire houses. You will also list what city you are renting in and how many guests you can accommodate.
  4. Next, you will choose the type of property. One of the draws of Airbnb is that you can put a lot of different types of homes on the site. You can choose things like boutique hotels, bed and breakfasts, boats, or even castles!
  5. Finally, the site will prompt you for more details, such as the type of beds available, how many guests can stay, how many bathrooms there are, the exact address of the property, and more.

Once you complete these basic steps to make a hosting profile, you can get begin ramping up your profile and adding more information.

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Bulking Up Your Profile

We all know that you only get one chance to make a good first impression, so make sure that your first impression as a host is a favorable one.

Profile Picture

First, consider your profile picture. It is crucial that you have a good profile picture that shows your real personality and also showcases other individuals who may be at the property (significant others, family members, etc.). Make sure you smile, the picture is good quality, and it shows some aspects of your personality.

Update Your Contact Info

After carefully choosing your profile picture, it’s time to add contact details. Make sure to add an email address and phone number that are accurate and that you have access to. Don’t worry, none of these details will float around the web without your permission. One of the benefits of Airbnb is that guests can expect a concierge service. Make sure you are reachable at all times to ensure that you’re not missing out on future bookings.

Get Social

At its core, Airbnb is a social media platform that connects peers with other peers and develops connections between them. Show your social side with at least 50 words. This could include likes, dislikes, interior design styles, or even favorite foods!

Also, make sure to share your profile on other social media platforms, such as Facebook, Twitter, and LinkedIn. If you are serious about getting exposure on your property, social media is a great way to do it.

Verify Your Profile

As vast and informative as the Internet is, it is also full of secrets. We all know that secrets are the last thing you want when renting out your home to strangers or renting from strangers, which is why Airbnb enlisted its verification software.

After putting in all your contact details, make sure you verify your profile by scanning in a state ID, driver’s license, passport, or other form of ID.

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Optimize Your Listing

Once you have your profile dressed up to the nines, it’s time to optimize your listing with great descriptions and photos. Too often, hosts get intimidated when listing their property because they don’t think they are good writers or don’t know what to say. Luckily, there are some helpful tips from Airbnb pros to help you overcome this hurdle.

Write Conversationally

As nice as it might seem to have a professional writer at your disposal, writing conversationally is actually more effective when it comes to Airbnb. By writing like you would talk to a friend, guests will know you are a real person and get a feel for your personality.

One way to get started is to sit down with someone and explain your property out loud (this is also a writing exercise that can be used in other ways, too!). The way you describe the place in this scenario is likely the most accurate way to describe it to others. Bonus points if you can get the person you are talking to to write down what you’re saying!

In addition to writing conversationally, make sure you keep it short and sweet. In the age of the Internet, readers have very short attention spans. Writing a description that highlights the key points, while cutting the fat, will be the most effective.

The Devil is in the Details

What do you look for when you rent a space or stay at a hotel? Comfy beds? New sheets? A view? Including small details like these might be the difference between someone booking with you and someone booking with your competitor. Some things you might want to include:

  • The sleeping arrangements, including the types of sheets, pillows, bedding, etc.
  • Entertainment areas, such as a patio or large common area
  • Some ideas for how to use the space, such as suggesting a dinner party, taking in Chinese food, or enjoying a glass of wine on the veranda

Here is an example of a good description, courtesy of Holly on Airbnb:

“Your space is a separate and private 240sq ft open beamed studio with a concrete countertop kitchenette including a stainless steel microwave, 2 burner stove top, sink, and fridge.

Your private bathroom is roomy with a shower (wash rack) toilet and marble topped vessel sink valise.

The main open room has a comfy queen bed with 6 pillows, quilts and a comforter as well as a comfy futon couch that can be used as an additional bed. Linens,towels, washcloths and bathrobes are all provided.

The concrete floors are great when it’s warm weather but even with the throw rugs you might want to bring slippers in the cooler months. The heater/air conditioning unit is quiet and works great.

There is a small covered front porch to hang out on with beautiful views of the Figueroa Mts.”

Look at those details! Holly’s guests know exactly what they are getting.

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Marketing Beyond Airbnb’s Site

After drafting a listing that you are proud of, it’s time to get as much mileage out of your property as you can. Here are some ways you can market your listing beyond Airbnb’s site.

Sharing is Caring

Sharing on social media is a great way to promote your rental property in front of your friends and their connections without much work on your part. Every time you post a new listing, share it on your social channels and encourage your connections to share it as well. Airbnb has integrations with multiple social media channels, so this process is seamless and easy. If you know of friends visiting your area, send them your listing. They could potentially be your next booking!

In addition to sharing on social media, Airbnb also allows users to embed their listings on other websites. Here are instructions on how to embed your listing, according to Airbnb.

References

One of the ways Airbnb helps hosts and guests build their profiles is by offering references. According to the site, “References help people throughout the Airbnb community get to know you, and feel more comfortable booking a reservation with you.”

References are different than reviews because they don’t have to come from someone who has stayed at your property. While reviews are only allowed by guests that have stayed at your place, references are just a way for the Airbnb community to connect and promote each other.

You may be hesitant to request references from people you know, but these references build a stronger relationship of trust and help you get your profile going, especially if you are just starting. You can request a reference through the Airbnb site, through email, or through social media. Thanks to Airbnb’s integration with Facebook, for example, you can request a reference from your Facebook friends (granted that they have an Airbnb profile with a picture).

Airbnb SEO

SEO is one of those marketing terms that has been buzzing around for the last few years, and many people are still scratching their head wondering what this term means. Simply put, SEO, or Search Engine Optimization, is a factor that determines how highly a person or business is rated on search engines like Google or Bing.

Search engines are always changing their algorithms, so SEO “tricks” that worked a few years (or even a few months) ago may not work today. That being said, you can use SEO to your advantage to get more exposure for your listing. Below are some tips you can use to optimize your listing for SEO purposes:

  • Make sure your calendar is up to date and all your booking availability is accurate. Both Airbnb and search engines will ding your listing if it shows incorrect data. After all, if someone is looking for a getaway and your availability is still stuck in 2015, they will pass up your listing.
  • Price your property appropriately by researching your competitors and leveraging the market. You don’t want to be the cheapest listing on the market because you won’t attract much of a paying clientele. You also don’t want to be the most expensive listing because people will go elsewhere and find a better deal. By setting a realistic price point, Google and other search engines will promote your listing, as well as Airbnb themselves.
  • Responding to all inquiries in a timely manner will put a great “response rate” on your profile and encourage others to reach out. While this won’t necessarily help for outside SEO, it looks good on Airbnb and shows guests that you care about their booking.

A Quick Recap on Airbnb Marketing Strategy

While finding an investment property or vacation rental was difficult pre-Revestor, much more work goes into making sure your listing is searchable and optimized.

First, make a profile on Airbnb and sign up your property. Include a clear profile picture that shows your personality, accurately describes your listing, and includes details that really sell. Think about what your guests would want to know, and exceed it. After all, a happy guest is an informed guest.

After making a profile, bulk it up with all the details mentioned. This will really set your listing apart.

Once you have a listing you are happy with, share it on social media and with your friends and family. Who knows which one of your connections might have a friend or family visiting the area soon and would love to recommend you as a host!

Speaking of recommendations, ask your connections for references – Airbnb’s way of letting people leave reviews without having stayed with you. These references will build up your profile in the beginning before you have any bookings.

Lastly, consider the factors that go into your Airbnb SEO, as well as the factors that influence your SEO with search engines like Google. By keeping your availability up to date, pricing your property appropriately, and responding to inquiries, you will stay top of mind when users are searching for places.

If you are ready to put your Airbnb skills to the test, check out Revestor today and find the perfect investment property for you! For more helpful tips, check out our blog post Airbnb Host Tips!

Top 10 Most Profitable Cities for Real Estate Investing

It’s no surprise that real estate is booming all over the country. Even cities that saw significantly smaller populations or were hit hard when the housing bubble popped years ago are on investors’ minds. First, let’s review what an investment property is and some of its benefits, then let’s cover the top ten most profitable cities for real estate investing and why you should consider investing there.

What is an investment property?

According to Investopedia, “Investment property is real estate property that has been purchased with the intention of earning a return on the investment, either through rental income, the future resale of the property or both.” These properties are usually not an investor’s main home, but serve as supplemental income through short or long-term rentals.

Short-term rentals are often referred to as vacation rentals and serve guests for shorter periods of time. Sites like Airbnb and VRBO provide outlets for investors to make money using short-term rentals.

Long-term rentals involve renting out an investment property to a renter who is looking to stay for a longer period of time. Investors interested in long-term rentals are focused on the end goal, like generating supplemental income or making a profit when the property sells in the future.

Depending on your needs and goals, different cities and properties will be best for you. Here, we show you the top 10 places best places to invest in real estate.

Where to Invest in Property?

10. Austin, Texas

Austin is an up-and-coming area for young people and families, alike. One of the draws of Austin is its increasing nightlife and attractions and its affordable homes. With the university close by, investors can expect to rent out their property to students or faculty in the area.

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Benefits of investing in austin

Some of the key benefits of buying a property in Austin, Texas include:

  • A rising demographic of young people, meaning that individuals might be looking for a long-term rental to grow or start a family.
  • More businesses, including the technology industry, are opening up in the area.
  • Nightlife is growing, as well, meaning that rent will increase as the population grows.
  • Real estate is affordable. The median home price in the West University area, for example, is $239,000, and downtown the median home price is $379,000.

Considerations of Investing in Austin

Don’t expect to get rich quick by investing in a city like Austin. In the area, most investors expect from 5-7% appreciation. In other areas, such as California, these rates are low. In addition, there is a high rate of people moving out of the area, including graduating students and people leaving for better paying jobs. This constant flight might be worrisome for some investors.

9. San Diego, California

Ask any local in San Diego and they will tell you to jump on the housing market while you can. This diverse city boasts some of the best weather in the country, access to beaches and cities, and many other attractions (including great Mexican food!). Investors who have more capital might be interested in this growing Southern California city.

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Benefits of Investing in San Diego

  • Some of the key benefits of investing in San Diego include:
  • A booming real estate market and increasing home prices. If you invest in San Diego today, expect your investment to increase in a short amount of time.
  • A diverse population of renters. In the area you will likely see surfer kids, working professionals, international families, and much more. Chances are, you will be able to find renters for your property with this wide pool of applicants.
  • Views! Nothing beats a Southern California view, which you can find in almost every part of San Diego.

Considerations of Investing in San Diego

If you are a first time investor, chances are you won’t be able to afford your dream home in a city like San Diego. If you are looking for an investment property, expect to pay more in such a high-demand city.

Another consideration of the area is that it has a very transient population. A lot of San Diegans are in the military, are students, are Mexican citizens staying for a short time, or other people looking to leave in the near future. If you don’t mind changing tenants regularly this might not be a deal-breaker, but if you are looking for consistent renters, San Diego might not be for you.

8. Charlotte, North Carolina

Charlotte is a southern city that has taken Millennials and older generations by storm. While some of the recent news surrounding the city has been unfavorable, it is a growing metro area with a lot to offer. Located on the cusp of the Atlantic Ocean, real estate in this area is ever-increasing.

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Benefits of Investing in Charlotte

  • You can get a good home at an affordable price. The average home sale price is about $185,000, which means that average rent is about $750 a month.
  • Even amenities are cheap. Locals boast that you can get a beer for $2 during a night on the town. These prices will attract younger renters.
  • In addition to a lively downtown, Charlotte also has greenery and keeps up wildlife conservation.
  • Talk about good food! Charlotteans’ favorites are barbeque and fast food.

Considerations of Investing in Charlotte

  • It’s still the Deep South, meaning that it lacks the diversity that some renters and investors might be searching for.
  • Homes sell fast and might not be seen without working with a realtor. Even on the popular house-hunting site Zillow, some homes might be under contract in less than 24 hours after it hits the market.
  • Investment properties likely won’t increase in value as much as other areas (but is still a viable option!)

7. Houston, Texas

Like Austin, Houston is redefining what most of the country thinks of when they think of Texas. The city is attracting a younger market with lively downtowns and many schools in the area.

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Benefits of Investing in Houston

  • The city is growing rapidly. Since 2010 the population has grown by 8.9%. In one year, between July 2014 and July 2015, Houston added 40,000 residents.
  • Home prices are low, with the average around $150,000.
  • Business owners and wealthy families are growing the artistic and musical attractions that Houston has to offer, making it more cultural than ever.

Considerations of Investing in Houston

  • The biggest thing on residents’ minds are natural disasters such as hurricanes and tropical storms. They do happen.
  • Commutes are long and residents will need a car to take full advantage of the area. Compared to some metro areas, this may be a deal-breaker.

6. Boston, Massachusetts

The East Coast real estate market has always been booming, and Boston has continued to hold its own. Although the Boston scene may already be more developed than other cities on this list, it’s still a contender for the best place to buy an investment property.

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Benefits of Investing in Boston

  • It is developed, attracts a wide array of individuals, and is close to many popular points of interests.
  • Once a Bostonian, always a Bostonian. Investors can likely expect renters to stay for a long time because the area is so attractive.
  • Besides being a popular city in itself, it is also close to hits like New York City and Washington, DC.

Considerations of Investing in Boston

  • Because it is already a large metro area, homes will sell for more than in other places. An investor must have enough capital to afford a place in the area. According to the Boston Globe, home sale prices are up 31% compared to in 2010.
  • Supply is very limited, so act fast!
  • Because housing is more expensive, most blue collar workers will be pushed to the suburbs, therefore increasing traffic and commuting times.

5. Salt Lake City, Utah

With Silicon Valley getting so crowded, some people are calling Salt Lake City the next big technology hub.

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Benefits of Investing in Salt Lake City

  • Job growth is at an all-time high and vacancy rates are at an all-time low.
  • Average rent rates jumped 4.9% and are at $892 for an apartment unit.
  • Tech, and other industries, are growing in the area and the city is no longer only for families with children.

Considerations of Investing in Salt Lake City

  • The weather may scare some renters away, with cold winters and hot summers.
  • The culture still lacks the diversity some Americans have come to expect.
  • There are a few strange liquor laws lingering around, such as no liquor at dine-in restaurants without ordering food, which might shy some younger renters away.

4. Tampa, Florida

Florida was a state hit hard by the recession and housing market crash, but it is getting back on its feet surely and stronger than ever.

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Benefits of Investing in Tampa

  • The city is located close to a major Air Force Base, which means that short-term renters are abundant. Military families also have a guaranteed housing budget, which might set some investors’ minds at ease.
  • There are a lot of condos and apartments for sale, as well as single family homes. It is likely that an investor can find a property that fits their needs.

Considerations of Investing in Tampa

  • Because of the large military population, expect renters to be more short-term than other areas.
  • Florida home sale prices fluctuate, meaning that you could sell your investment property and make a profit, or you might have to sit on it while waiting out the low times.
  • Like North Carolina, this southern state faces the threat of natural disasters regularly.

3. Las Vegas, Nevada

It may surprise you that the Las Vegas housing market is still alive and well, but as the city continues to grow so do its housing opportunities.

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Benefits of Investing in Las Vegas

  • We all know the saying “what happens in Vegas, stays in Vegas,” which is one of the reasons why people will always come back. Tourism is booming in Las Vegas, which means good news for business owners.
  • Although Vegas went through a slump a few years back, they are now attracting a younger crowd again. With live shows, DJs, and other entertainment, young people will come (and bring their friends!)
  • There is more to Vegas than just the strip. Locals know of all the good, less commercialized nightlife.

Considerations of Investing in Vegas

  • A lot of housing in Vegas is short lived, either because residents tire of its lively nature or because of better jobs elsewhere. Because of that, short-term rentals are more popular.
  • Although Las Vegas has done its job of attracting young people, the market isn’t as booming as it used to be. Investors might be curious of its future.

2. Boise, Idaho

When you hear about Idaho, you likely think of farmers and potatoes. But the state has a lot more to offer than you may think. From skiing at Sun Valley to living in cities like Boise, this market is hot.

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Benefits of Investing in Boise

  • The market is new and fresh, meaning that you can purchase a property at a lower cost than other areas in the country.
  • Job growth and population has grown dramatically.
  • Multiple reports have considered Boise as one of the best cities to raise a family. This means that investors can expect new parents to stay for the long-term.

Considerations of Investing in Boise

  • While the population is growing, Boise isn’t as attractive to young people as some of the areas on this list.
  • The weather is extreme and might not be for all residents. Expect cold winters and hot summers.
  • Boise, and most of Idaho, is more rural than other metro areas. This could be good for some renters and not for others.

1. Denver, Colorado

Denver is a very profitable area for investors right now. It has been attracting diverse populations for years and has a lot to offer renters.

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Benefits of Investing in Denver

  • The area has grown and there are many points of interest nearby.
  • Public transportation is prominent and appeals to many renters.
  • There are many schools and universities nearby for children of all ages.

Considerations of Investing in Denver

  • The market is hot, so act fast! Places sell fast in the area.
  • A lot of the homes for sale are older and may require extensive fixing up.

Investment properties are a great way to generate supplemental income and make a profit, if marketed correctly. These are ten of the most profitable cities for real estate investing, but no matter where you live Revestor can help you find the best short-term investment properties in your area.

The Complete Guide to Making Money on Airbnb

Recently all three of Airbnb’s founders — Brian Chesky, Nathan Blecharczyk and Joe Gebbia — landed spots on the Forbes billionaires list. Yet they’re not the only ones making money from this platform. In fact, some Airbnb hosts consistently capture six-figure incomes.  

One man decided to rent his home during periods when he was traveling. He quickly realized the income opportunity and went on to acquire four different properties, and today he earns over $100,000 from Airbnb every year.

This is just one story, but there are many others that show how both the occasional Airbnb host and those using it as a business (as described above) successfully leverage this tool. But if you haven’t used Airbnb before, what should you expect if you decide to become a host? Here’s a complete guide to making money on Airbnb.

What is Airbnb?

Airbnb is an online marketplace that allows people to rent homes or single rooms to guests. Just like hotels, guests are charged a fee, which typically also includes a deposit, cleaning fee, pet fee (if you allow pets), and other optional costs.

Guests use Airbnb for a variety of reasons. Sometimes it costs less than staying in a hotel, or they simply want access to interesting accommodations that aren’t otherwise available. For example, you can stay at this tropical tree house in Hawaii for less than the cost of staying at most resorts.

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But it’s not all about cost for some guests. The company’s website says, “Live there. Book unique homes and experience a city like a local.” For many guests, it’s about having an experience that most hotels can’t provide.

The platform is popular with hosts because it allows them to easily earn a profit renting their space. Plus, as described above, some people are using Airbnb to create a full-time business.

Recently, Fast Company highlighted such a story, which featured a host named Bradley. He rents six different properties in the San Francisco area and reports profits of $2,000 per unit — which adds up to $12,000 each month. This host’s earnings are significant, and they give you an idea of the large opportunity available through Airbnb. But where should you start?

How Does Airbnb Work?

Setting up an account and listing your property on Airbnb is easy. Start by clicking the button at the top right titled “Become a Host.”

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Once you click this button, tell Airbnb what you want to offer for rent. You can choose from the following options.

An entire place. This is great if you have an investment property and you want to rent it out as a vacation unit. For example, below is an example of a unit where guests can rent the whole place. It shows how many bedrooms and beds there are and how many guests the unit can accommodate.

This host charges a fee of $149 per night. Occupancy rates vary based on the location, but let’s say you have an occupancy rate of 64 percent (which is on par with the national average). That would yield earnings (prior to any expenses) of $34,806 annually.

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A private room. Maybe your child just left for college, and his or her room is empty (except for holiday breaks, of course). If so, renting the room through Airbnb may be a great option. In fact, it could even net enough to pay your child’s college tuition bills! Here’s an example. This is a private room with ocean views at a rate of $125 per night.

At an occupancy rate of 64 percent, annual earnings (prior to any expenses that you must pay) would be about $29,200.

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A shared room. And finally, let’s talk about a shared room. What does that look like? Check out this bunk, where the host charges $30 a night and supplies desk space and an Internet connection along with use of the communal spaces.

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At a rate of $30 per night with an occupancy rate of 64 percent, this would yield earnings of $7,008 prior to any expenses.

Once you decide what type of space you’ll offer, select a price for that offering (more on this in a minute), fill out a description and upload photos so guests can get a sense of what the space is like.

Plus, you get to set house rules for the listing.

For example, for that communal space listed above for $30 a night, the host includes rules such as:

  • Be courteous to other guests. No talking loudly or playing music past 11 p.m. Sunday through Thursday.
  • Clean up after yourself.
  • Keep your space (especially the desk space) clean, as other guests may need to share it.

The list of rules may grow or change as you start hosting, but it’s a good idea to start with a few basic requests.

Once you’ve filled out all the required details, you’re good to go! The listing goes live and you can start taking reservations online. Once a guest books a reservation, you receive a confirmation and message from the guest. Then you can communicate with the guest directly to answer any questions about booking.

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Getting Paid

So now you know how to create a listing and connect with guests — but how do you get paid? Decades ago, listing a vacation home for rent required you to take personal checks, but today Airbnb makes this process more streamlined.

First of all, you should know there is a host service fee, which is 3 percent of the subtotal (prior to fees and taxes). But here’s the good news — this fee covers the cost of processing payments. The company also charges a guest service fee, which helps cover the costs of running Airbnb. This fee is typically 6 to 12 percent of the reservation total, but it can be higher or lower based on the reservation. Also, depending on the laws in your area, VAT may be charged on top of service fees.

For payment, you decide which options you want to offer. It’s important to note that off-line or cash payments are a violation of the company’s terms of service, and accepting them may result in your being prohibited from using the site in the future. So make sure that guests pay through the site. Here’s a quick breakdown of the payment options you can offer guests.

Major credit cards. Guests can pay through Visa, MasterCard, Amex, Discover and JCB.

ACH transfers. Airbnb deducts guest fees directly from the guest’s account and wire transfers the funds to your account. Set this up through the Airbnb platform, which requires your bank account routing number and account number. When setting this up, Airbnb does a $1 test transfer to ensure the payment method works correctly. It takes about five business days to get ACH transfer set up, so start early.

International wire transfer. Are you living outside the country? If so, you can set up an international wire transfer. However, there may be restrictions on the amount of funds that can be deposited, so check this out prior to offering this payment method.

PayPal. This option is simple for the host and the guest. Set up a PayPal account, which allows Airbnb to facilitate transferring money from the guest’s account to yours.

The company also offers a Payoneer Bank transfer/debit card and Western Union. For Western Union, there are many rules, so if possible, select another option.

Once you’ve set up your payment options, you may be wondering “When do I get paid?” Airbnb releases your payout 24 hours after the guest’s scheduled check-in time. The amount of time it takes for money to reach your account varies based on the payment method. For guests who stay 28 days, payouts for that reservation are released on a monthly basis.

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Airbnb Pricing: Getting it right to maximize earnings

When you create a listing, Airbnb will include a suggested price based on similar listings in your areas. Airbnb recommends starting below the suggested rate if you have never offered a listing through Airbnb before. Why? When guests stay at your home, they provide a review. Listings with a high number of favorable reviews can command higher prices. Starting out, you need to get people in the door, show them how awesome your place is and start building that stellar online reputation. That is the first goal.

Once you’ve established a history with Airbnb and have positive reviews, look at adjusting your pricing. You can spend additional time researching comparable properties. Consider looking at what’s happening on other platforms, such as checking out properties on VRBO (more on this in a minute). Then adjust your pricing slightly higher. What happens? Track your results and monthly occupancy rate.

For example, let’s say that Airbnb recommends that you charge $135 per night for your property. But you’re new, so you decide to charge $100 a night. Right away you get large numbers of bookings, and your occupancy rate is at 90 percent, which is $32,850 annually. But over time, your guests leave rave reviews and you’ve achieved a five-star rating. What would happen if you increased your rate to $160 per night? Would the occupancy rate decrease?

To experiment, you increase the rate, and the occupancy rate does decrease slightly, to 80 percent, but with annual earnings of $46,720 — which is a $13,870 increase! Plus, with a lower occupancy rate you may see minor decreases in variable monthly costs, such as electricity usage, yet overall earnings are higher.  

So the best strategy for pricing is to test and measure. Maybe you’ll price too high and occupancy rates will decrease — that’s okay. Experiment until you strike that perfect balance.

Plus, you may want to look at offering package deals. For example, if you have an occupancy rate of 60 percent, maybe you want to offer reasonable package deals during the off season to drive up occupancy rates and profits. Consider offering price breaks for off seasons and to guests planning extended stays.

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Airbnb Host Perks

If you’ve never listed a house or room through Airbnb, it might seem risky. What happens if a person rents your house and causes excessive damage? Sure, you charged a deposit, but it doesn’t come close to covering the damages. Now what happens?

For situations like these, the benefit of using Airbnb versus working with a potential guest directly is that the company offers a $1 million host guarantee for every booking. On Airbnb’s website, it says the following.

“We’re committed to creating a safe and trusted community around the world. Though property damage is rare, we understand you may need protection. The Host Guarantee will reimburse eligible hosts for damages up to $1,000,000.”

But what’s protected? The company provides a detailed list on its Host Guarantee terms page. But here’s a sampling of what is not covered:

  • Cash and securities
  • Pets
  • Personal liability
  • Shared or common areas

Also, certain types of property — such as artwork, jewelry and other collectibles — may have limited coverage. Airbnb wants people to remove these items prior to renting out the space.

The company also offers “Host Protection Insurance” at no cost to those using the company’s platform. Basically, it provides primary liability coverage for up to $1 million in the event that a third party claims bodily injury or property damage. The company provides examples here of what’s covered and what’s not covered. For more information and helpful tips, check out our blog post Airbnb Host Tips!

Choosing the Right Airbnb Investment Property

Maybe you aren’t considering renting out your existing home but instead are thinking about purchasing a property for the sole purpose of renting it out on Airbnb. If so, here are a few tips for selecting that perfect short-term investment property.

  • Regulations. Each city has its own set of regulations that apply to short-term rentals. Check out RoomScore, which rates cities by Airbnb friendliness. For example, a city may have a high hotel occupancy tax or other taxes that could drive down profits.
  • Location. First, look at the most profitable places to own rental property. For example, Forbes compiles a list of the hottest cities in which to own rental properties; Provo-Orem, Utah; Austin-Round Rock, Texas; and Orlando, Florida, all topped the list recently.  
  • Weight of all potential costs. Consider possibilities such as the following: Does the city have high energy costs, or does the property have steep HOAs and other costs that may negatively affect profits? If so, factor these into your investment decision.
  • Risks. Each property has a different set of risks and payoffs. For example, do you need a high occupancy rate for cash flow? If so, it may be wise to purchase in an area that demands a lower per-night rate but consistently has higher occupancy rates. Assess the potential risks and rewards.

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Marketing your Airbnb property

Once you post your Airbnb listing, it’s important to make sure that it gets found. Here are a few tips to ramp up its performance and get more guests through the door:

  • Focus on stellar reviews. One of the easiest ways to get ranked higher on Airbnb search results is to get great reviews. It can almost guarantee you more bookings and higher ranking in search results. After a guest’s stay, show him or her a great review and ask whether he or she would mind rating you.
  • Earn elite status. Earning the title of “super host” gives you a position as a favorite of the site and therefore makes it easier to reach more potential guests. Earn this status by completing at least 10 reservations per year, having a 90 percent or higher response rate, securing at least 80 percent five-star or higher reviews and rarely canceling your reservations. Check out full details here.
  • Promote listings through social media. Create a post with your profile or property. Extra links can help your search rankings inside and outside Airbnb.

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Weighing the Options: Airbnb vs VRBO

Airbnb isn’t the only game in town for advertising and renting your space. There is also the popular VRBO, which has 794,000 listings. However, it’s important to weigh the benefits of each option.

VRBO offers a few different plans for pricing. For example, you can elect to have an annual subscription or pay-per-booking fee structure, which may provide some benefits. Check out the costs here.

Also, it’s important to note that VRBO does not charge guests a fee, which is appealing to guests, as their overall bill is lower.

Each platform also has different cancellation policies. For example, VRBO has an individual cancellation policy, where the host states the policy in the listing. The host might say, “No refunds on cancellations less than 30 days prior to arrival.”

In contrast, Airbnb’s business model has a tiered cancellation structure. Hosts can choose from flexible, moderate, strict and super strict.

For example, flexible allows for a full refund, excluding fees, one day prior to arrival, while strict provides a 50 percent refund, excluding fees, until one week prior to arrival.

Also, there is no rule that you can’t list your property on both platforms. Test them out and see which performs better. Then put all your efforts into the better-performing platform.

Moving Forward with Success

Airbnb is an amazing tool, one that helps turn your largest assets — your home or investment property — into additional cash flow. As with any new venture, however, it helps to start small.

Are you renting out a room? Take a single reservation and see how things go and whether it’s right for you. Communicate with your guests. What are they looking for when visiting your property? Do they want to “live like a local,” as the Airbnb site says?

If so, brainstorm ways to create a truly local experience. Renting your property through Airbnb is certainly about earning money, but it’s also about creating the experiences that your guests crave — yet can’t get from a big chain hotel. That’s key to your success.

What Kind Of Investor Are You? Part 1 of 3

Over the next several weeks I’ll be diving deeper into each of the three strategies for real estate investing. I’ll uncover some of the advantages and disadvantages within each path to help you make more informed decisions as you continue to develop your business and grow your portfolio.

Last week I wrote a post on the 4 basic steps to getting started with real estate investing. The framework for your future business. You can read that complete post here but for those of you already familiar with the article, we’re going to focus on the first strategy I referred to in step #1.

  • Long term rental (buy & hold)

This week I polled a handful of experienced investors, all of whom have used Revestor to find buy & hold deals and asked them a series of questions. The information presented in this post is a collection of that feedback and my hope is that it helps you make well informed decisions.

When is the right time to invest in real estate?

When it comes to buy and hold real estate investing you need to think “get rich quick slow”. The benefits to buy and hold real estate investing do not come in the form of a quick buck but rather in the form of appreciation and passive income. Not to say you can’t make quick money by walking into a property with built in equity but you need to adopt the marathon vs. sprint mentality. I also received a lot of responses about “being in the know”. Simply put, decide when to get in based on the numbers, market trends and as much factual data that you can gather. Knowing the numbers is the key to mitigating risk in any real estate investment. One of the main benefits to using Revestor is that we allow you to run the numbers over actual listed properties. Be sure to get familiar with these key indicators to help you make more informed decisions.  

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Just a reminder for those not familiar with some of this terminology, you can find the definitions on our site here.

What should I look for in a potential property?

Doing your due diligence goes beyond knowing the market trends and numbers; especially when it comes to acquiring real property. A savvy investor always wants to acquire property with built in equity. This doesn’t mean getting your agent to write countless lowball offers until someone accepts but rather have a vision of what your property can be. For example, can you add a bedroom or bathroom? Can you update a kitchen or the exterior? These changes don’t require a lot of money or major renovations but they can fetch you higher rents and increase the overall value of your property. It’s also important to be thorough with your inspections. A cracked foundation, faulty plumbing or a deteriorating roof can cause crippling expenses to inexperienced investors. Make sure the property you’re purchasing is in sound shape to help minimize future surprises.  

One of the most common buy and hold strategies for new real estate investors is with multi-family properties. In this case, you the owner, occupy one of the units while renting out the other units to help offset / cover the cost of the mortgage. One of my good friends and one of the most successful real estate investors I know has used this method to build a small empire. He acquired properties by coming in with all cash (hard money loan), giving him the advantage over other buyers. Once he had possession and rented all but one of the units he would take out a mortgage, pay back his hard money loan and begin rehabbing the unit he occupied. He was creating equity and instant cash flow this way.

Next steps

Create a FREE account on Revestor, get familiar with the terminology and start gaining knowledge. By creating an account you will be able to…..

  • Search nationwide
  • Set your own investment criteria
  • Save searches
  • Save properties
  • And more

Creating an account with Revestor allows you to filter and find properties that work for you saving you time and money. You can create your account here and clicking “Sign Up” in the top right corner.

Next week I’ll be going over the basics of short term buy & hold for you vacation rental owners.

Happy hunting,

Teevan

 

Five Tips to Ensure You Stay Competitive in the Real Estate Industry

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Remaining competitive in the real estate industry requires hard work and persistence. Property managers must provide a wide array of services for their clients, including the following:

  • Marketing properties to commercial and residential tenants
  • Screening potential tenants to reduce turnover and ensure on-time payments
  • Providing maintenance service for all units
  • Handling paperwork and recommending price points for lease and rental fees

For investors going at it alone in the real estate marketplace, managing all these tasks can be challenging. Here are five of the most important keys to longevity in the property management and real estate investment fields.

Tip #1: Solicit Feedback
Finding out what tenants are saying about you and your property is critical to maintaining a positive public reputation. By proactively requesting feedback regarding your properties, your maintenance procedures and your overall business practices, you can ensure a greater degree of tenant satisfaction and can reduce turnover in your investment properties. This can boost your profitability and ensure steady revenues for years to come.

Tip #2: Research Price Points
Making use of available tools to check pricing for comparable properties and to determine the real value of each real estate investment under consideration can help you select the right properties for your portfolio and the right rent or lease price points for your tenants. By staying competitive in the financial field, you can improve your performance and profitability in the real estate marketplace. Don’t forget to take neighborhood information into consideration; the right location can make a big difference in the desirability of a property.

Tip #3: Embrace Modern Technologies
Communicating with clients and tenants via email or text can save time and money in managing reminders and handling necessary correspondence. By paying expenses electronically, you can also reduce paperwork inside the office, allowing you to maintain a green-friendly workplace while enjoying added convenience for all your transactions. Mobile devices and cell phones can provide improved access to information, allowing you to stay productive even after hours or when you are away from the office.

Tip #4: Track Your Return on Investment
Maintaining meticulous financial records is not only a legal requirement but also a good idea to ensure that you are turning a profit on your real estate investments. Comparing revenues with expenses for each property in your portfolio can allow you to identify underperforming investments and take steps to address these issues to ensure the highest level of profitability for your company.

Tip #5: Trust but Verify

The right screening processes can have a real impact on the quality of tenants your properties attract. Checking credit reports, references and past payment patterns can provide added insights into the financial habits and dependability of potential tenants. In both the commercial and the residential real estate markets, acquiring and retaining the right renters and lessees can give a significant boost to your overall profitability. A little due diligence can go a long way toward helping you achieve this goal.

These five core strategies can help you manage properties and maintain a healthy financial profile in the real estate marketplace. By keeping your eyes on the profitability prize, you can expect your investments to pay off for increased longevity in this constantly evolving area of the U.S. economy.

4 Ways to Go “Green” — Our 1-2-3 Guide On How to Be More Eco-Friendly in Real Estate

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As climate change becomes an increasingly important part of our daily vernacular, finding ways to increase energy efficiency and environmental responsibility throughout your company can provide you with added savings on utility bills and reduce your carbon footprint. For real estate investors and managers, establishing a green-friendly brand image can provide a distinct selling point for your company while distinguishing you from your competitors in this field. Here are four proven strategies to boost your environmental credentials in the real estate industry.

Green Tip 1: Explore Paper-Free Options

Reducing the amount of paper needed to conduct business can have a dramatic effect on your office’s environmental impact. Some of the most important ways to limit paper use include the following:

  • Opt for online applications rather than print versions of the same documents
  • Allow for and encourage electronic payment and receipt options for tenants and lessees
  • Invest in centralized cloud or server storage rather than maintaining file cabinets and printed copies of contracts and other documents
  • Choose online commercials and a corporate website over printed brochures and direct mailings

These strategies can help you reduce paper use while offering the same top-quality service for current and prospective tenants in the modern eco-friendly environment.

Green Tip 2: Install Energy-Saving Fixtures

Although the cost of full replacement of light fixtures, water heaters and air conditioning units can be prohibitively expensive, upgrading to energy-efficient models over time can provide huge selling points for new tenants and corporate clients. According to the U.S. Energy Information Administration, lighting accounts for almost 20 percent of energy expenditures in the commercial sector. Installing green-friendly lighting fixtures and electrical equipment, you can reduce the cost of utilities every single month. Water-conserving bathroom and kitchen fixtures are also important in areas hard-hit by drought. Best of all, the cost savings realized by your tenants can result in increased retention and reliable revenues for your investment company.

Green Tip 3: Recycle and Reuse

Recycling aluminum, paper and glass items can be a good starting place for instituting green-friendly policies in your office. Refilling printer toners and recycling electronics can also reduce the environmental impact of your business enterprises. By passing along unwanted and obsolete equipment to charitable organizations or recycling centers, you can provide added help for those who need it most. At the same time, you prevent dangerous or toxic substances from contaminating ground water in your area.

Green Tip 4: Consider Transportation Options

Investing in a hybrid vehicle can not only provide you with added green cred among your potential clients, but can also save you a considerable amount on fuel costs during the course of an average year. By driving a vehicle that is in line with your corporate environmental policy, you can also enhance your company’s reputation among environmentally conscious buyers and sellers.

These four strategies can provide your real estate company with an added selling point for green-friendly clients and can enhance your overall reputation for innovation among potential renters, buyers and sellers. By adopting an environmentally responsible attitude toward all aspects of your business operations, you can enjoy the economic benefits of lower utilities and an improved market position among the eco-friendly demographic of the U.S. economy.


References:
http://www.eia.gov/tools/faqs/faq.cfm?id=99&t=3

Do You Like Free Money? Six Tax Tips For Homeowners

taxes

 

Buying your own home can provide an added sense of security for your entire family. With every mortgage payment, the amount of equity in your property increases to improve your overall financial position. This major purchase also comes with some important advantages that can help you save money on your taxes year after year. Here are six of the most important tax benefits associated with purchasing and owning a home.

Tax Tip #1: Mortgage Interest Deductions

For those who itemize deductions on their annual income tax returns, the mortgage interest deduction can add up to real savings each year. According to the Internal Revenue Service, better known as the dreaded IRS, the average mortgage interest deduction adds up to $12,615. The taxes that would otherwise be due on this amount can add up to thousands of dollars, making mortgage interest an important deduction for the 75 million homeowners in the United States.

Tax Tip #2: Home Equity Lines Interest Deductions

The interest paid on a secured home equity line of credit or loan is also tax deductible. These financial arrangements can provide added flexibility for homeowners in managing major expenses while reducing the overall level of tax obligation for these individuals and families. By opting for a home equity credit line over traditional revolving credit accounts, it may be possible to save a significant amount on taxes over the course of the loan. Transferring high-interest credit card debt to a lower-interest home equity loan can not only reduce monthly payments but can also offer significant tax advantages for qualified homeowners.

Tax Tip #3: Closing Costs and Points

Depending on the terms of the mortgage and purchase agreement, buyers can usually deduct any origination fees from their taxable income. Most homebuyers pay at least one percent of the total cost of the home in points to reduce their monthly payments over the life of the loan. Points are generally deductable if the following criteria are met:

  • The loan is secured by the primary residence of the buyer.
  • The points are within the amount normally and generally allowable for the area in which the transaction took place.
  • The buyer paid at least as much at closing as the amount of points deducted from annual taxes.
  • The cash method of accounting is used to figure income and expenses.

A qualified tax attorney or real estate professional can often provide detailed information regarding the deductibility of points on income tax returns.

Tax Tip #4: Property Tax Deduction

Property taxes on both primary residences and vacation homes are tax-deductible. This can add up to real savings on state and federal income taxes.

Tax Tip #5: Tax-Free Rental Arrangements

Renting out your home for a couple of weeks each year can be a financially profitable venture, especially if you maintain a vacation home in an exotic or in-demand area. Best of all, the fees received for rental agreements of two weeks or less need not be reported to the IRS and constitute tax-free income to you and your family.

Tax Tip #6: Tax-Free Profits on Sales

Homeowners can also deduct a healthy chunk of the profits derived from selling their primary home:

  • Up to $500,000 for couples filing jointly.
  • As much as $250,000 for individuals.

 

By taking advantage of these benefits, you and your family can enjoy the greatest possible tax savings year after year.

 

Revestor Tip: Don’t Forget to Do Your Research

Although it might seem like common sense, many investors get caught up in the hype of an investment and forget to do their due diligence.

Before even looking into an investment property, you need to figure out where you would like to own an investment property, what kind of property you want, how much you can afford to put down, and how much you are willing to spend to fix it up (if necessary).

Once you have your list of investment criteria, you can begin to look for properties matching your needs. That’s where Revestor comes in. You are able to create a search for your exact criteria and you will be notified when new properties match your search.

Once you are in the process of purchasing a home, you need to make sure to ask every question possible. You not only need to know everything about the house itself but about the surrounding area as well. Some key questions are:

  • Why is the homeowner selling?
  • What is the current mortgage and expenses on the property?
  • What was the last sale price and when was it purchased?
  • Has anything been renovated or does it need to be?
  • Will there be any zoning restrictions if you want to expand?
  • What is the average income of the surrounding neighborhood?
  • What is the average price of the other houses in the neighborhood?
  • Are there any liens on the property?
  • What is the crime rate in the area?

As an investor or real estate agent, do you have any other key questions you ask before moving forward with a property? Share them below!