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» Getting the Most Value for Your Investment Propert
Posted on 2/25/2005
When selecting investment properties, many investors look at the long term potential for the land (location) of the property as an important issue. I would not disagree: the three most important things about real estate are location, location and location. However, that said, it is important to note that if you want a hard money loan (or any
other commercial loan) for the property, whether it be for the purchase or a refinancing in the future, you will do well to consider the monthly cash flow for the property as well.
Simply put, it is better to purchase a property with a continuing, reliable monthly cash flow than to invest in the raw land if you want to collateralize it against a loan. If you are able to pay outright for the property, purchasing a large vacant lot may pay off when the area is ready for a new shopping center or other growth that brings
good offers for the purchase of your property. However, if you need a loan to buy it or want to collateralize in the future before selling it, consider a smaller lot with an income generating business, apartment building, SFD or even a parking or storage lot on it. Lenders consider the income of the property as a primary concern when valueing the property and considering the amount of the loan as well as the rates they will charge.
Posted in Miscellaneous
other commercial loan) for the property, whether it be for the purchase or a refinancing in the future, you will do well to consider the monthly cash flow for the property as well.
Simply put, it is better to purchase a property with a continuing, reliable monthly cash flow than to invest in the raw land if you want to collateralize it against a loan. If you are able to pay outright for the property, purchasing a large vacant lot may pay off when the area is ready for a new shopping center or other growth that brings
good offers for the purchase of your property. However, if you need a loan to buy it or want to collateralize in the future before selling it, consider a smaller lot with an income generating business, apartment building, SFD or even a parking or storage lot on it. Lenders consider the income of the property as a primary concern when valueing the property and considering the amount of the loan as well as the rates they will charge.
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