Double Your Money In Real Estate Investment in the US
There is no short cut to getting rich quickly or making money in real estate.
In particular, in the United States (US), real estate is one of the best ways to build wealth.
Over time, you can slowly build wealth by consistently investing wisely with the proper knowledge, advice, strategy, and determination.
Investing in properties stands out as a proven strategy to make money.
If done the right way, by educating yourself about the process, you can make money in real estate and enjoy great returns.
If you know how to double your money in a short period – you wouldn’t be reading this article.
Don’t be fooled by some “get rich quick” schemes.
These are a game of chance.
You probably heard or knew someone who knows someone who knows someone who does it.
If you want to double your money in real estate investment returns – it is possible.
One of the best ways for investors to double their money is by generating high returns on their money in real estate investments.
Yes, it is not farfetched, but you can indeed grow a real estate empire over time.
If you wanted to increase your investment returns, you would need a proven workable strategy aside from just being more disciplined, dedicated, and patient.
That’s not a fair statement, though, as we also need to invest our expertise and time to bring about the real estate deals together.
Making money in real estate is not just about getting a “good deal”.
There are so many advantages to owning a property for an excellent long-term investment, including leverage, appreciation, and tax benefits.
“Ninety per cent of all millionaires become so through owning real estate. More money has been made in real estate than in all industrial investments combined. The wise young man or wage earner of today invests his money in real estate.” -Andrew Carnegie.
If you’re not going to put money in real estate, where else?
Investment is not putting money in and expecting to collect twice the amount you invest the next month or year.
That would be gambling.
In this article, we shall discuss both active and passive you can money in real estate investing.
Remember, real estate is a vehicle for wealth building, and knowledge is the key.
In our experience for both stock and real estate investing, timing the market never works.
There’s no wrong or right time to invest, but nothing will pay off more than educating yourself when investing.
Do the necessary research and analysis on whether to invest in a local market or US real estate before making any investment decisions.
In a nutshell, it is not how to time market cycles or what drives markets BUT how you can maximise the ready capital you have to make money in real estate.
Noble Sky International shares a proven strategy that we have used since 2014 to help our clients grow wealth and double their money in real estate investment in the US.
We’ll show you how to make money in real estate and avoid the most common mistakes.
The value we bring for our investors are deals that don’t require a mortgage or loan.
If you find this interesting and you are interested, read on.
“The quickest way to double your money is to fold it in half and put it in your back pocket.”- Will Rogers.
Other than that, quick fun trick, we need a solid, proven strategy to get going with the actual plan to grow our wealth for the rest of us.
Before you start doubling your money in real estate, you can think of your Financial Freedom Goal if you like.
What is your Financial Freedom Goal or Dream?
Financial Freedom Dreams can include something you want to buy, own, or do in your lifetime.
It can also be a life-changing experience.
Your Financial Dreams are yours alone, and yes, they can differ significantly from someone else’s.
If you like, you can draw a picture of these dreams- or use short phrases to describe them.
- comfortable retirement
- good education
- 3-bedroom house
- 2 car garages
- swimming pool
- private library
Whatever floats your boat – Whatever brings you Joy!
Maybe your dream is simple, but right now, it just seems out of reach as you are investing in your future.
- luxury sports car
- world cruise
- bucket trip holiday dream
- dream wedding
- master’s or PhD.
- children’s college fund
- build your own home
- Retire at 45
- Not worrying about money
- a retirement income
Your Financial Freedom Would Include Some Indulgences.
Perhaps, it is Financial Vitality that you want; you need a sum for economic security – plus a little extra for indulgences
- dining out
- concert tickets
- spa treatments
- club membership
- or any other small luxuries that personally make your life a little sweeter, and why not?
Before we dive into doubling your money in real estate investment in the US., let’s look at how most people start thinking and planning.
How can I turn $500 into $1000?
For a start, this is simply doubling your money.
The internet has many more ways than what you and I can think of at the top of our heads.
Here are some ways we read that got some people’s interest piqued.
But I’m not sure how many invested their hard-earned money into these platforms and made substantial headway towards their Financial Freedom Plan.
Learn to invest in the Stock Market: Investing in the stock market is the most common way for beginners.
Try Robo Investing: Robo-advisors and automated portfolio builders.
Start an Online Selling Website: if you have a product.
Invest in Yourself with Online Courses: There are plenty of courses you can take online or in person.
Resell Thrift Store Clothing: While these clothes may come from a reseller’s closet, many resellers hunt for vintage or old high-end clothing at local thrift stores.
Flip Clearance Finds: Make physical shopping trips and buy clearance items and find and sell these online on your own or Amazon.
Peer to Peer Lending App: Some online platforms and apps provide investors direct, low-cost access to high-yield consumer loans from creditworthy borrowers.
Build a real estate portfolio: Buy your first property and learn to leverage to double your money in real estate.
The last item on the list – build a real estate portfolio or amass several rental income properties is something we have done well in this part of the world.
It’s an Asian/Singaporean thing. We like properties.
Singaporean’s love affair with property resumes amid an economic recovery, with property prices expected to rise by 4 per cent in 2021.
Many younger Singaporeans are opting to rent homes first instead of buying a property in the city.
Since the last decade, Singaporean investors have doubled their money in real estate by “snapping up shophouses by the rows” in George Town, Penang in neighbouring Malaysia.
Like their Singapore lookalikes, these identical two-story shophouses command a hefty rent in Penang, escalating five times from the RM1,300 rentals charged before 2010.
The cost to buy a two-story commercial pre-war shophouse is RM 2,000,000 (US$485,050) as is on-site.
You will need to put in renovation costs, architect’s fees, permits, comply with stringent guidelines and strict restoration laws.
Rental costs are between RM7,000 and RM10,000 a month (US$2425)
If you had invested in a pre-war shophouse, you would find most of these left vacant by the covid-19 pandemic in the nationwide lockdowns.
So, where do you invest if you can’t capitalize on the strong Singapore dollar?
Asians Start Making Money in Real EstateMostt real estate investors invest in speculative new domestic real estate development in Asia, which drives transaction prices upwards.
Using bank mortgages, local real estate investors are often limited by the higher lending rates, purchase price, and ultimately the number of properties they can own.
While there is no limit to the number of private properties you can own as a Singapore Citizen or PR, there are specific criteria to follow for HDB.
For HDB owners, they would need first to purchase an HDB flat and occupy it for at least 5 years before investing in a private property (local or overseas).
Developed countries like Singapore, Malaysia, and Indonesia have certain thresholds for real estate investment.
Asia’s home buyers and investors, in particular, Singaporeans, have shifted their attention overseas.
As traditional real estate investment markets in developed countries in the UK, Canada, and Australia become saturated, investors are looking to making money in real estate in the US.
The purchase of properties in the US is not as restrictive in terms of the number of units purchased and owned by a single investor.
The largest age group of real estate investors are those between 30 years old to 49 years old.
Technologically savvy and always on the lookout to grow their wealth, these financially stable and able buyers are more affluent.
These investors source for properties in the US since their countries’ properties are now over-priced.
For the price of a condominium down payment in Singapore, Kuala Lumpur (Malaysia), and Jakarta (Indonesia), you can invest in a landed single-family home in the US.
The US provides a cheaper and yet authentic alternative to owning multiple rental properties, especially for retirees.
Earning rental income in US$ while living in Asia is the biggest boon.
Investors going for a strong enough currency to hedge against any potential depreciation risk select the United States to invest in.
The robust and stable US dollar is crucial for investors acquiring overseas property and residential real estate.
Can You Double Your Money In Real Estate In Asia?
Simple math – if you have $1, you double that; it’s $2.
If you can do this on your own WITHOUT gambling, you might want to skip the rest of this article altogether.
I know I was curious myself when I thought about it before I learned the simple secret (no secret really) since people have been doing this for years and will continue to do so.
Doubling $1 to $2 is easily achievable, but it will not make a big difference to your life unless you’re a little kid – you will probably spend that sum to buy candy.
First, let’s set up some parameters.
Say you have US$50,000 and want to double that to US$100,000 – and let’s put a time frame to that too, say five years.
Does that sound like a reasonable time frame?
You may think – “I could do that myself. Why would I need anyone’s help?”
Yes, you could buy a property in the city you live in, rent it out and sell it for a profit.
It is not rocket science. There is no secret sauce.
Let me know, in all honesty, if you know anyone in your city who has done successfully.
And will show you the exact roadmap for the successful investment?
Has anyone ever doubled their money by buying the cheapest brand-new property?
Making Money In Real Estate Investment – Condominium Prices in Singapore, Malaysia, and Indonesia
For most people, the norm to get their 30% down payment, a 70% bank loan, and a mortgage for the next 15, 25, or even 35 years.
Even with the latest promotions from savvy developers, with FREE legal fees, the reality is this. IF you want to make money in real estate, you will probably look at condominiums.
When investing in properties in the cities, most investors will look at condominiums as landed residential property prices can be exorbitant in the city centres.
Surprisingly the prices of condo In Penang state (island) in Malaysia is the priciest!
If you want to double your money, say from US$50,000 to US$100,000, that would be hard set.
What Is the Strategy to Double Your Money in US Real Estate?
The strategy is not to buy a property in your backyard, city, or country.
In the United States, Noble Sky International can do things differently.
Legally, of course.
Yes, it is legit.
How we can assist our Clients and Investors do, is to help them set up a Business Entity in the United States to buy the properties there.
Why US Real Estate?
Real estate investors who invest in US properties make money through rental income, profits generated by business activities that depend on the property.
That includes capital appreciation.
One of the benefits of investing in US real estate includes passive income, stable cash flow, tax advantages, diversification, leverage, and the unfair advantage you can’t find in Asia.
Here are the 6 Reasons Why We Choose to Invest in US Real Estate.
- Market Size
- Ease of Acquisition
- Land Ownership
- Price to Value Ratio
1 US Real Estate – Market Size
According to a new Zillow analysis, US housing gained about $2.5 trillion in value in 2020, a record-setting year of home sales, the most in a single year since 2005.
US housing’s entire stock is now worth $36.2 trillion, and the US real estate market still shows no sign of cooling off.
Strong demand drove intense competition among buyers and pushed prices higher as investors want to make money in real estate.
Two things drove this demand.
1. A sizeable Millennial generation is growing into prime first-time home-buying age.
2. Mortgage rates hovering near record lows.
The COVID-19 pandemic prompted many buyers to re-evaluate their housing options.
While many potential buyers faced economic hardship because of the pandemic, others with stable income were eager to enter the housing market.
With the widespread shift to remote work, buyers now could buy where they prefer to stay instead of choosing a location near their workplace.
2 US Real Estate Market – Inventories
As a potential investor, find favourable buying trends to determine if you should now or later.
For Noble Sky, we “buy” in the area with potential growth instead of waiting or “timing the market.”
Investing in properties differs from the stock market going wild.
When the stock market is volatile, you have new investors freaking out and behaving irrationally.
With the recent volatility, many investors started talking about why they’re buying or selling more stock.
Many investors try to time the market by getting out when stocks are high and re-enters when it’s lower.
Of course, all investors, new and experience, always think they can execute this successfully.
The reality is none of us can, and we have neither an edge nor an advantage.
Low Inventory – Housing Inventory Hits a Record Low
A big reason why housing inventory is meagre is that American sellers are hesitant to list their homes during the pandemic.
While you may want to invest in certain areas, you are competing with American buyers when there is an acute shortage of properties on the market.
However, when you leverage Noble Sky International’s network of realtors wholesalers and bidding at online auctions – you increase your opportunities to get a suitable investment property.
As a result, you have a significant advantage over other buyers.
3 US Real Estate Market – Affordability
Dollar for dollar, the properties, and homes in the US are much more affordable than local markets in Asia.
In particular, Asian investors found that homes’ prices are significantly lower than what they can buy in their own countries.
As most Asian investors live in the cities, they gear the investments toward buying in areas where people live in a gated and a guarded community of condominiums and apartments.
Most investors preferred to invest in high-rise apartments and condominiums because these properties have performed well in the past.
Despite the rising prices of a luxury condo, many investors are still buying in and paying mortgages and exorbitant maintenance fees.
The question of affordability comes to mind.
As a real estate investor, you want to find properties that meet the following criteria so your investment dollar will go the furthest.
4 US Real Estate Market – Ease of Acquisition
In the US, a private property transaction can be off-market–this means the buyer is the only party negotiating for the acquisition.
Another way is for the property to be offered to the public through a county auction sale or a bank foreclosure.
The seller can also engage a broker to market the property for sale to the highest bidder.
5 Land Ownership
Nearly 40% of the United States is public land.
Taxpayers supported the public lands and managed by federal, state, or local governments.
In America, when you buy a house, you own the land.
Fee simple title and ground leasehold title are the most common forms of US commercial real estate ownership.
In fee simple title ownership, the ownership entity owns all rights, titles, and interests in the real estate asset, including its right to free alienation.
6 Price to Value Ratio
The price-to-rent ratio depicts the relative affordability of renting versus home buying in a particular real estate market.
A city’s price-to-rent ratio compares the costs of renting and buying and measures the relative affordability of renting and buying in any housing market.
One of the things you need to check back on your investment back home is this – are you really making money in real estate?
The price-to-rent ratio is a clear indication of how much profit you are making.
If your mortgage repayment is US$2,200 per month and your rental is US$970 per month with maintenance fees of US$200 – you’re running a deficit.
Making US$770 (US$970 – US$200) and servicing a US$2,200 per month is not good.
If you’re planning on disposing or selling the condo for profit, say 10 years down the road, you would still have to pay Capital Gains Tax.
Would you be able to buy a similar new property in a neighbour you like with the amount of money?
Getting Gems Under the Average Market Price
You will want to buy an investment property below the average market price that makes money in the short term and long term.
Noble Sky International’s business model helps investors from Asia gain access to the property market in the United States.
We do this in a two-fold method, partnering up with investors from a business entity to purchase market prices properties.
We do this by analysing data from several sources to find a list of the cheapest states to buy a house in America in 2021.
To help you do that, you can look at the following websites for median prices and historical price trends to get a feel of available Stateside.
Yahoo to find the cheapest cities to buy a home
- World Population Review to determine the current cost-of-living index for each state
- Zillow Research for home values and historical price trends
- HomeSnacks for the median rent of a 3-bedroom home
For investors, while several factors move us to a data-driven decision-making world – nothing can replace having boots on the ground for the gut-feel decision making.
Our research is in-depth and not based solely on data online.
We work with a US Team of experts to provide the estimates necessary to keep renovation costs down and deal with the inspections and get utility connections.
Also, dealing with construction matters and getting the approval and permits affects every construction contract, which has a “time is of the essence” proviso added to the contract within the agreement’s stipulated time.
The cost of ongoing project delays caused by COVID-19’s effects is an indicator that ultimately measures profitability.
Where are the cheapest houses in the US?
Did you know that many minimum-wage workers couldn’t afford to rent a two-bedroom apartment in the US?
America’s lack of affordable housing is a national issue and affects most cities like New York and San Francisco, known for their high living costs.
Comparing a state’s median housing price to the median family income and mortgage interest rates determines the states that offer the most affordable housing.
The cheapest states to buy a house are
Average Price : $198,000
Cost per square foot: $124
Average Price : $200,000
Cost per square foot: $103
Average Price : $200,000
Cost per square foot: $118
Average Price : $229,000
Cost per square foot: $130
Average Price : $233,000
Cost per square foot: $130
Rising Home Prices
Since November 2020, existing home prices jumped by a staggering 15% over home costs of 2019.
Sellers get their asking price or even a higher offer if a bidding war breaks out amongst multiple buyers trying to buy the same property.
With the price hike, lack of affordable housing, and “displacement” by the covid-19 pandemic, many Americans work from home and will “migrate” away from the cities to places with cheaper rentals.
The Boom in Online Real Estate Services
In 2021, Technology continues to make an enormous difference in helping buyers and sellers and will continue in the following decades.
Both sellers and buyers get to view the home’s online photos, read a complete description of any property they are interested in, and compare prices.
This process makes house hunting much more straightforward for someone who’s thinking about buying a new home.
Increased Accessibility With Risky Buying Options
Some innovative ways of “snagging” properties in a seller’s market include the option to rent to own.
It all depends on the contract you put together with the owner to rent a home to buy.
Another “risky” option involves securing a personal loan (you need to have collateral to qualify for a personal loan) for the down payment money.
Personal loans can be expensive, but sometimes they’re your best option if you can pay it back.
As with any secured loan, you stand to lose your collateral if you cannot repay.
With interest rates on these loans low in the United States, this provides an opportunity for some people who might not have the means to purchase a home.
Knowledge of U.S. Real Estate Investing
For you to be a “knowledge broker” in any marketplace, even in your city, doesn’t just happen, especially in real estate.
The more knowledge you have, the better you are in the long run for amassing properties.
It is beneficial to stay up to date on home buying trends and investment opportunities.
Much more affordable than local markets
The US’s average house isn’t that much cheaper for Americans, but for Asians, you can get far more for your money than back home.
The land is relatively cheap in the US, and savvy developers utilise cheap land located outside the city centre to build many new developments and suburbs.
Developers in the US. are competitive as they get the best prices for materials.
Comparatively, you can get a home in the U.S. for the down payment money you put in for a luxury condo in Singapore, Kuala Lumpur, Jakarta, or other cities in Asia.
Purchasing Investment Properties Under Market Value
Noble Sky International focuses on buying homes that are 70% to 80% below the average market price.
We look for the ugliest house on the prettiest street.
The important thing is the location.
We are not bargain hunting but use data-driven research to find the below the average house price.
There is no point in getting very cheap rougher houses in the more challenging neighbourhoods.
For investors keen on earning a rental income, buying a rental property is a good idea–you get to make a monthly payment with the hope of future appreciation.
However, if the rental property loses money every month, whatever positive Cash Flow you make contra the mortgage for the condo.
Worst still, you don’t even break even and end up paying more to service your loan and maintenance fees.
What Is the Investment Strategy to Double Your Money in Real Estate Investing?
Since 2014, Noble Sky has used this one strategy to help our clients achieve their financial goals.
Our U.S. Team assist us to buy valuable properties from
1. U.S. Country Auction
2. Motivated Sellers
1 U.S. Country Auction
Before we look at where you buy valuable properties below the market value prices, let’s look at U.S. Property Tax Law.
What is Property Tax?
Property tax is a tax placed on assessed on real estate by a local county government.
The most frequent use of property taxes in the U.S. is by municipal governments, authorised to generate the revenue under state law.
The amount of tax is determined annually based on the market value of each property.
They computed Property Tax as the determined market value times an assessment ratio times the tax rate.
The county government impose the Property Tax on real estate property as revenue for the municipality to perform essential administrative functions.
- police protection
- welfare services
What is a County Tax Sale?
A Tax Sale is a public auction of tax deeds or tax liens used to recover delinquent real property taxes that homeowners owe.
Why does a County sell a tax-defaulted property?
The primary purpose is to collect delinquent taxes owed.
Public auction of delinquent property or tax liens recoups the back taxes, penalties, and interest due.
At auctions, they can claim proceeds over the taxes and costs of a sale by the former owner and other lien holders.
2 Motivated Sellers
The phrase “Motivated Seller” on real estate listings means the property owner is eager to close the deal on their property quickly.
The desire to sell or close quickly can be for many reasons.
- “Migration” to another city
In real estate, “wholesaling” or, a wholesaler contracts a seller with a home to sell, and then he finds an interested party to buy it.
Most of the time, it is a motivated or even desperate seller who needs the money quickly.
The wholesaler finds a buyer at a higher price than the price the seller wants and keeps the difference as profit.
Real estate wholesalers find and contract motivated sellers or distressed property owners.
For example, the wholesaler might find a family property sold via owner financing.
The owner wants to sell their home but cannot because they need to manage the bank loan.
They may need the money to buy a new home or need the cash for their retirement.
Some have a shop that they cannot manage because of old age or may not have the resources to refurbish it to match other retail properties.
Some properties are inherited, but they might not want to stay there to enjoy a quick sale.
In any case, wholesalers are great contact points to find these sorts of deals that are often not advertised or put on listing.
The seller might want US$80,000, and you may be willing to pay US$100,000.
The wholesaler, who in this case, being the middle man, closes the deal, gets everything in order, and pockets the US$20,000 as his fees.
Both the seller and buyer get the property at the price that they both want.
Once you have the property, you can put your plan to monetise the property and rent it out as a traditional home rental or an Airbnb.
You could keep the property for a few years and sell it later if you get a good offer from someone else, or you could redevelop the property.
What is the unique advantage, you ask?
How would you, as an investor from Asia, find such deals?
While you search for more knowledge on how investment in US property works, you can learn to double your money in real estate by Flipping Properties.
You can join the RESCUE webinar >>>>>> HERE.
With this one straightforward strategy, you can increase your capital growth every year with each successful Flip Project.
Typically, our investors put in $50,000 on each Flip Project.
As you can see from our Case Study, typically, Joint Venture Partners take at least five Flips for their money to double.
We are looking to double a $50,000 investment and not a $5,000.
If you are looking to double your money in real estate in three to five years, doing no work or heavy lifting, read on.
Types of Investment
There are many forms of investment out there that you might grow your wealth.
It all depends on the risk level you will bear.
Every individual has a different risk profile depending on age, personality, and the value of investments.
So, it is hard to create one steadfast model that is suitable for everyone.
Some people are risk-averse, while others thrive and love the thrill of the stock market prices skyrocketing; for others, it is an investment in the next bright and shiny object – cryptocurrency.
Here is a list of the Types of Investment
- Investment Funds.
- Bank Products.
- Saving for Education.
Stocks, bonds, mutual funds, and ETFs are the most common asset categories.
These are among the asset categories you would likely choose from when considering investing for your retirement savings program or retirement income.
Other asset categories include real estate, precious metals and other commodities, and private equity.
Real estate is not as liquid as stocks and will require more money and time.
Under the right circumstances, real estate can be an alternative to stocks.
Real estate investing offers lower risk, yielding better returns, providing greater diversification and capital gains.
“Buy land; they’re not making it anymore.” – Mark Twain
Many of us probably have felt the compulsion to heed that advice and buy a plot of earth to call our own.
Typically, when you purchase a home in the US, you do own whatever lies beneath and around the property.
Level of Growth
It would be best if you had clarity and purpose in real estate investment.
Choose the category that best suits your purpose, and then execute your plans accordingly.
A lack of purpose and clarity may lead to unexpected results.
Real estate has the potential for high-value growth; its low liquidity may lead to financial distress if you over-leverage and have multiple mortgages to juggle.
Investment Property Vs. Own Use Property
We purchased an investment property with the primary intent of making a profit when we sell it.
Many newbie investors confuse a day-to-day home they live in (own property) with an investment property.
Once you are clear on the categories of investment properties, you will become a savvy investor.
Buy and self-use.
Primarily, this is the first home that you buy to live in to save on rent while you wait for capital appreciation.
Buy and lease.
You can buy and lease the property to get regular income and long-term value appreciation.
The only downside to this is being a landlord, managing tenants, repair works, and handling disputes and possible legal issues.
Buy and sell (short-term).
Investors who want a quick, small, to medium profit, buy a building under construction from a developer and sell it for profit on completion.
Buy and sell (long-term).
Rental properties that focus on intrinsic value appreciation over a long period fall under this category.
Long Term Buy, hold, and sell compliment long-term goals, such as children’s education and retirement.
What Is the Passive Investments Strategy to Double Your Money in Real Estate?
American investor, business tycoon, philanthropist Warren Buffett doesn’t invest in anything he doesn’t understand – neither should you.
While real estate is the most lucrative market, there are many things to consider.
Considering all factors besides prevailing trends and future predictions, US real estate can double the money you invest.
Investing in real estate is a massive bet if you don’t study the market correctly.
It would help if you found suitable properties to invest in and allow them time to mature.
If you plan on achieving a higher ROI on your real estate investment, there are ways you might double it.
Buying an investment property is one of the most proven and effective ways to get higher returns in capital gains.
Studying the property investment data and property research is crucial, especially getting your calculations down pat before making an investment decision.
Noble Sky International has an all-American Team based in the United States to assist with viewing property on-site and providing estimates and appraisals.
We have professional help that makes it easier to calculate returns more precisely.
The best returns are from properties near schools, hospitals, shopping, public transportation, a university.
The more convenient the location, the more people will want to live there.
The most populated places have the highest demands for renting and selling in the future.
New York City (NYC) is the most densely populated major city in the United States.
In 2019 the estimated population of 8,336,817 was distributed over about 302.6 square miles (784 km2)
Data by Redfin.com shows that homes for sale in New York have a median listing price of $895K.
When you look at this, it means that the potential rent rate and the rental pool’s quality have access when we market the properties.
How to Double Your Money Through Investment in Real Estate?
As you find out more, you realise the possibility of doubling your money based on time-tested investment strategies.
The strategy you choose depends mainly on your risk tolerance and your timeline for investing.
Every investment comes with some risk, and this includes real estate.
Real estate investing is a safe option for many first-time investors.
You should be able to reduce your risk further if you have the means to diversify your money into different real estate investments.
Find A Zone with High Returning Potential in the US
You’ve heard of getting the right property in the correct location.
Nothing can be more accurate in determining the return potential of any investment property.
The location of a property plays a crucial role.
Finding the right neighbourhood to buy in for real estate investment ensures a good income and returns.
Real estate amenities influence occupancy rate, rental income, and growth potential.
Essentially, a “liveable neighbourhood” is “pleasant, safe, affordable, and supportive of human community.”
The top consideration is a good school district, followed by crucial safety elements, low crime, an attractive pedestrian-friendly community free from traffic congestion, decent, affordable, and convenient.
Not all communities are the same.
No district can be perfect since not all areas can be perfect for everyone. Everyone has their unique requirements.
Most people look for these six amenities that are common to all great neighbourhoods.
Many localities in American suburbs are gaining pace as great investment-friendly real estate hubs.
Land Value Vs. Property Capital Appreciation
Many first-time property investors and home buyers believe the physical attributes will increase the property value.
In reality, essential repairs and maintenance will determine the physical structure and its future value.
In the future, land appreciates because it’s in limited supply.
A building can decay and depreciate after several years if it is not properly maintained.
As the population increases, the price of land will be higher per sq. ft.
For business or investments, the depreciation of a property’s physical structure can reduce tax obligations.
One of the best indicators of your home’s current value is the sale prices of similar homes in your neighbourhood that have been sold recently.
For families with school-age children, the top consideration is a good school district.
The quality of the neighbourhood’s schools will significantly influence the residential investment property’s appreciation.
Rental properties close to universities are ideal for students who need a place to live as they attend school.
The value of your investment property value might be affected if educational facilities are non-existent or are of poor quality.
Not everyone owns a car, so properties near public transit for easy connectivity options and around a neighbourhood are essential to many tenants.
Look for essential factors like proximity and distance from the city centres, connectivity to public transportation like trains and bus stations.
A bus stop or nearby train station will encourage tenants to move from one area to another.
Shops and Restaurants
Shops, restaurants, and cafes are essential neighbourhood amenities to consider when investing in residential property.
Locations with easy access to goods and services quickly and affordably drive demand for a rental property.
An area with recognisable brand names like Starbucks and McDonald’s shows that brands have scrutinised the location and expect future growth areas.
Buying a residential investment property close to a state-of-the-art gym will increase the number of potential tenants.
Entertainment and Leisure Facilities
Entertainment facilities help residents break from their busy schedules to relax and have fun with their family and friends.
A lively neighbourhood with entertainment facilities is a draw-card for young people to build a vibrant community.
Look for a residential investment property near cafes, bars, clubhouses, movie theatres, sports grounds, swimming pools, playgrounds and, parks.
Access to medical care quickly in case of an emergency is essential for all residents, especially for children and retirees.
Some elderly tenants or families with young children would consider the distance of healthcare facilities to home when selecting a rental house.
You can study government plans and initiatives and identify the area’s business development scope to analyse further the appreciation rates, future predictions, and current market supply and demand.
Which Type Of Property Will Double Your Money In Real Estate Quickly?
The two major categories are commercial real estate and residential real estate.
For most individual investors, a residential investment property augurs better in terms of initial capital outlay.
While many favours residential real estate, other investors invest in commercial real estate that provides stable income through long leases.
While the pandemic has office workers working from home, there will be increased demand for office spaces with a higher rental and lower maintenance once the situation recovers.
Some investors find commercial real estate is more attractive in the long run as the US gains momentum after a dull period.
The types of property in the US are: –
Single Family Home
A detached single-family home is a building that sits on its land designed to be used as a single dwelling unit.
These American single-family homes are tiny, have a square footprint, and primarily single-story with a raised veranda and a covered area to sit at the front and back.
Typically, the home has two bedrooms, one bath, and about 1,000 s.f. But can be more extensive.
Multi Family Home
A multi-family home is a single building designed to accommodate more than one family living in each unit separately.
Sometimes it can include an In-law suite.
It can also range from a duplex with two dwellings within a single building to homes or small apartment buildings with up to four units.
One way to capitalize on this type of building is to live in one unit and rent out the others.
An apartment has multiple units of dwelling that are part of a larger building.
Usually, it consists of several units with rooms on each floor of a high-rise building in a city, where land is too expensive for people to have separate houses.
An apartment in the US is called a condominium or “condo” in Asia.
Office space is a room or room in a building that provides a suitable environment for office operations.
These are leased spaces.
Commercial property is real estate that is used for business activities.
Commercial property usually refers to buildings that house multiple businesses, but it can also refer to land used to generate a profit and large residential rental properties.
Know the Type of Investment Property That Will Double Your Money In Real Estate
Getting a profitable residential investment property means literally stepping into your tenant’s shoes.
The secret to the correct investment zone lies in knowing the amenities essential for your tenant’s well-being – knowing this will determine the type of investment property that doubles your money in real estate.
Up-and-coming neighbourhoods are those that have not yet reached the transition to the more desirable communities.
Sometimes these areas could have lower-rated schools, or it could mean a location with higher crime rates.
You may want to invest in properties in established neighbourhoods and communities where some buyers will be willing to pay a premium to buy property in these areas.
The properties located in college towns offer good unique opportunities for investors looking for a potentially large tenant market.
Student accommodations offer relatively stable rental prices and full occupancy.
However, the disadvantages are frequent tenant turnover and maintenance issues.
Plus, you will need to spend time and money to fix significant wear and tear issues.
Getting a vacation home for a rental is like running an Airbnb.
While the returns on rentals are much higher than traditional monthly rentals, a vacation home isn’t a set-it-and-forget-it sort of investment strategy.
It’s one of the most hands-on investments that require year-round hands-on work.
If you are running this yourself, there is a never-ending list of tasks to clean, prep, and restock the property before the following guest checks in.
Strong population growth
Investing in an area where there are young families will see rapid growth due to the birth rate.
Older communities and neighbourhoods may see a declining cause by the death rate rather than growing new families.
Another sign of vigorous population growth is where new industries are set up.
Americans will migrate to new jobs in the cities.
On the positive side, when there are neighbourhood improvements, a low-value area can be transformed into a high-value one.
When neighbourhood gentrification happens, new businesses move in; there are improvements towards street repairs, utilities, schools, amenities, and community parks.
Gentrification often leads to commercial and economic developments, improved opportunity, lower crime rates, and increased property values, which benefits existing property and homeowners.
Three main types of investment properties can double your investment return quickly.
Your Property Investment Income – When Does Your Money Double?
Most of us want the short answer – we want to know when our money will double.
The question is, how much money?
For $1 to double to $2, that is pretty achievable and in a short period.
So, it is for $100 to double to $200, and we can look at more considerable amounts the same way.
$500 to $1000.
The value we want to look at would have precedence in earning power.
Say an average return of 10%, 20%, or even 30% annually.
Rule of 72 defined
Using the Rule of 72, you take the number 72 and divide it by an expected rate of return.
For example, if you have a $10,000 investment earned or expect to make an average of 10% every year, it will take 72/10 = 7.2 years for your money to double.
For Noble Sky’s Investors, the average returns are at a minimum of 30%, so to double your $50,000 investment, it would take 72/30 = 2.4 years for your money to double.
Property Investment Income US Real Estate Types
Up to this stage, we have provided many options for those who want to know how to make money in real estate.
You can own residential, commercial, and even industrial real estate property.
For beginners, we look at residential properties as the start-up value is smaller, and it is more accessible to dispose of the property.
Let’s go through three of the top ways to make property investment income and the real estate types you can invest in.
#1 Making Money in Real Estate Through Rental Properties
Investing in residential property can be a lucrative way to increase your wealth and ensure a monthly rental income.
Rental Properties is the traditional way of making money in real estate and getting rich.
People will always require a place to live.
For this type of investment, you leverage long-term buy-and-hold residential rentals to make money.
One of the biggest benefits of owning rental real estate is the steady cash flow it continuously generates.
Rental properties are the best way to earning a passive income.
While many people use the income to be paying off the mortgage, there are ways to double your profit.
To ensure better returns from your rental property, you can opt to rent out the house as an Airbnb rental unit instead.
Finding a property near universities will yield more rent from individual students renting bedrooms.
To capitalise on rentals, properties near amusement parks, water parks are great as vacation rentals.
In many cities, few entrepreneurial types have ventured into land reclamation to create new land from oceans, seas, riverbeds, or lake beds.
You may buy land, build a home, and then rent it out.
You can also invest in Turnkey properties where you purchase a property that has been rehabilitated with a ready tenant living there.
Regardless of how you acquire the property, it is a buy and holds strategy to make money in rentals.
Cons of Owning Rental Properties
Some investors prefer to own an entire floor of units or even an apartment complex of your own.
The downside of this strategy is the rental income suffers when people move out or when the repair costs eat into your profits.
The bottom line is this—set yourself to buy one to three rental properties a year.
Not to invest in some ten properties at one time, as some other investment programs may recommend.
You don’t have to maintain a property like a landlord.
You can hire a property manager to deal with tenant’s real estate licensing or taxes for a steady income stream.
#2 Fix & Flip Property
One of the best ways to start your investment portfolio is to find cheap older distressed properties, rehabilitate them, and then sell for a quick profit.
Getting a Fix and Flip property is not as easy as it appears on TV.
While this technique’s appeal requires purchasing a property, many think it is a cosmetic makeover.
Properties that require rehab or some work put in are usually available at a lower price.
However, it would help if you put in some extra bucks in refurbishing the house.
Some elements that can make or break a Flipper are unseen cost for foundation, roofing, sanitary, and water plumbing.
You can rarely get a property that only requires some minor touch-up and a coat of new paint.
But you also wouldn’t want to put in money to turn a middle-class home into the only luxury property on the block.
When we invest, we want to buy the ugliest house on the prettiest street.
Not the other way around.
Some people lose money their hard earn money into older properties in an “ugly” neighbourhood to get the prettiest house.
You can’t afford to lose your money this way.
We’d recommend tapping into funds from your savings to put down on older single-family homes in an excellent neighbourhood to flip.
Most Flip properties are remodelled for an upsell at a higher price in a short time.
To start, if you’re going it alone – Buy and Flip one property at a time.
It might take you a long time to learn the ropes without a team or the expertise of an experienced builder or contractor.
It is never easy to go solo to manage your properties in the US with the 12-hour difference.
We recommend that you leverage Nobel Sky International’s presence in the US and our Singapore headquarters to manage the properties and do the work for you.
#3 Real Estate Investment Trust
A real estate investment trust (REIT) is a company that owns, operates, or finances income-producing properties.
REITs generate a steady income stream for investors but offer little in the way of capital appreciation.
In a nutshell, REITs are like stocks.
Investors invest their money in commercial real estate properties instead of residential properties.
As commercial real estate properties cost millions, investors invest in corporations’ buildings through investor’s money.
A real estate investor gets regular income, making no traditional type of real estate transaction.
You get the real estate exposure, and over 90% of your investment paid as dividends.
In summary, when you look at the Real Estate Types, the question you need to ask yourself is this – What if you own other properties that turn out to need far more work than you expected?
What if the apartment building you own isn’t working out as expected?
If you own dozens of rental homes, consider selling them to buy professionally managed single-family homes in the United States.
What if you can’t rent out the properties you own, but you have been holding on to them for the past ten years?
You spend more money on maintenance and security annually than you made in rental in the last decade.
Too many investors become obsessed with holding on to their properties – by being right, even when the gains are small.
Cutting your losses when you’re wrong makes more sense than being right, especially when you are not making money in real estate.
These are real-life scenarios we have encountered speaking to potential investors in Singapore, Malaysia, and Jakarta.
If the property hasn’t been making any profit, zero cash flow for the last decade, it is time to sell it and pay off the debt.
With the cash you have leftover, you can start over and invest in a property or other properties to generate the Cash Flow.
After all, you have always wanted to build up your property portfolio and make millions in real estate.
What you decide today will ensure a change in your network in the next five years.
When you’re ready to earn a real passive income, that is one route you can take.
Initial Investment or Original Investment
When you look at your initial or original investment value, you need to compare this with the returns you can make on your own in your country.
Some of our students in Vietnam have remarked that they made 800% profit from their investments.
When prompted to reveal the details, it was inherited tracts of land sold to a developer.
While 800% profit from the land sale is achievable, this is not something that he could be repeated make the same profit from again and again.
Land can only be sold once.
What is Your Initial Investment?
As a newbie, most investors will ask about the amount of money required to start a real estate investment.
Although you could start with $10,000 and potentially make a 30% profit, you will only make $3,000 with the ten grand investment.
When you understand that it takes money to make money – you will realise that with $500,000, you stand to make more.
30% of $10,000 = $3,000
30% of $500,000 = $150,000
30% of $1,000,000 = $300,000
What Is Your Return On Investment?
The most popular way is to buy an investment property and slowly build up your portfolio.
One of the ways to make money from real estate assets is through rental income.
When you lease the property to tenants either by traditional rental or Airbnb, you collect a rental income.
While the bulk of wealth and money in real estate comes from appreciation, property value increases over time.
The most important thing you build through real estate is Cash Flow because it reduces your risk.
Types of Cash Flow
Overall, the Cash Flow Statement provides an accurate account of the cash used.
Cash flow from investing activities is the cash generated and intended to produce a profit in the future.
Types of activities include capital expenditures, purchases, and property sales property sale that make money in real estate investments.
Cost of Investment
For new investors, knowing the cost of investment is essential.
For the cost of investment, the calculation is as follows.
The total expenses are $15,000 (say $5,000 + $10,000 = $15,000)
Then, subtract the total expenses (say $15,000) from the revenue ($43,200)
The difference is ($43,200 – $15,000 = $28,200)
Next, divide the difference between the investment’s gain and investment cost by the cost of the investment. ($243,200/ $200,000 = 43,200)
Period of Time
We often consider flipping as a process that occurs within a few months.
However, for the NOOB, a more conservative timeline is better – you can view anything within five years as a short-term flipping horizon.
For the house’s value to double or increase by over 100%, you may need to force increase your property’s value.
Your renovation will include increasing the total build-up area of the home and its footprint.
You could invest a certain amount of money to increase the living space, add more bedrooms, bathroom and remodel the kitchen and bathroom.
Another example that you could do without building an extension is to convert the attic or basement into cosy rooms.
How to Calculate Your Return on Investment (ROI)?
Return on Investment (ROI) is a performance measure used to evaluate an investment’s efficiency or profitability or compare several investments’ efficiency.
We calculate ROI by subtracting the initial value of the investment from the final value of the investment (which equals the net return)
Then, divide this new number (the net return) by the investment cost, and, finally, multiply it by 100.
Positive Cash Flow
Positive cash flow shows that a company’s liquid assets are increasing, which enables it to cover obligations,
- reinvest in its business,
- return money to shareholders,
- pay expenses, and
- Provide a buffer against future financial challenges.
Gross monthly income is the amount of income you earn in a month (before taxes or deductions are taken out).
Rental income is any payment you receive for the use of the property.
The rental income can be from traditional monthly rentals or short-term Airbnb rentals.
Expenses for renting a property which includes maintenance and other services, can be deducted from your gross rental income.
What Is a Rate of Return (RoR)?
A rate of return (RoR) is the net gain (positive) or loss (negative) of an investment over a specified time (in years) presented as a percentage of the investment’s initial cost.
When calculating the return rate, you determine the percentage change from the beginning of the period (start) until the end of the investment.
Is Doubling Your Money Wealth Building?
When you hear of others making a “home run” in real estate, you will see wealth creation with the large windfall of money from properties that they own.
While prices fluctuate over the long haul, real estate builds wealth more consistently than any other asset class.
As investors, we need to know that there are four types of wealth:
- Financial wealth (Money)
- Social wealth (Status)
- Time wealth (Freedom)
- Physical wealth (Health)
Long Term Wealth
Over the last two centuries, about 90 per cent of the world’s millionaires make their wealth by investing in real estate.
For the average investor, real estate offers the best way to develop significant long-term wealth.
For investors, you aim to have an investment portfolio to provide financial security over the years.
You can meet financial goal over a long time horizon.
The investment portfolio needs to take care of your other objectives apart from just making money relentlessly.
True wealth is the ability to live life on your own terms. It’s freedom.
True wealth – true financial freedom – is free to focus on the things that matter most to you in life.
Unlike the investing world, there aren’t clear-cut rules for achieving happiness.
Wealth For Generations
Building generational wealth – wealth passed down from one generation to the next is called family wealth or legacy wealth.
As real estate investors, we can achieve this is to leave something tangible behind for our children or grandchildren.
The properties and land tracts you grow in your portfolio will contribute positively to your family’s generational wealth growth.
Why not start thinking and planning now?
Successful Short-Term Real Estate Investment Property
For Noble Sky International, the investment projects are short term.
We help our investors to gain below market value properties, upgrade and improve them to the city inspector’s recommendation – then put them out on the market quickly.
Remember the adage “time is of the essence?”
Our US Team is on hand to ensure that we can turn the profits around quickly.
Here are a few of the list of successful short-term real estate investment property that made a tidy profit for our clients.
Choose the Property Type wisely.
You need to measure all the pros and cons of investing in residential and commercial property before making your final decision.
While investing in real estate is a tried and tested approach to make money, as with every other business, there are some risks associated with it.