Pre Foreclosures & High Rent Equal Profit For Investors

As drought conditions and blazing heat paralyze a huge swath of the nation, buy and hold real estate is heating up as the investing flavor of the day, helping real real estate investors able to tap into available cash to purchase properties on the cheap, and let waves of cold hard cash flow into their bank accounts.

In this month?s Home Stand, we?ll give you the inside story about which areas are the hottest buy and hold markets, the spots which are just now getting ready to heat up ? and why.

As if this weren?t enough, we?ll also throw in a golden nugget about this month?s coming press release, which will enable you to reap the rewards available in the marketplace today.

Buy and Hold Investing Hotter Than the Weather

In most cases, the hottest real estate markets won?t hit you in the head with a brick to get your attention. Buy and hold investing has taken off in many parts of the country, though, so if your head isn?t throbbing with the untapped potential, you haven?t been paying attention. So where are the hottest markets?

The Hottest Buy and Hold Markets

Reis, Inc. spends a ton of time digging into the national apartment market, and the data they?ve sifted through shows that average rents have topped $1,091 per month, which represents the highest rate since before the national real estate market fell headfirst into the abyss.

If you?re a buy and hold investor, you?re all too well aware that the amount you ask for rent and the amount you actually receive are sometimes two completely different figures. By the time investors shave off a few bucks for marketing incentives (free rent, deferred/reduced deposits/and other one-time perks), effective average rent is still well over $1,000 monthly ? $1,041.

New York and San Francisco apartment housing markets have been red hot for some time, and that isn?t likely to change anytime soon. Somewhat surprisingly, nearly all major apartment markets in the U.S. are seeing robust leasing activity and rising rents. For buy and hold real estate investors, this is good news! Read on for some of the reasons why.

Up and Coming Buy and Hold Opportunities

One major area of the country hasn?t yet seen its local apartment market heat up to the extent that it has in other parts of the country. Not a complete surprise, Florida continues to have plenty of available vacancies, with the 7 worst vacancy rates in the nation occupied by Florida cities:

Fort Myers 37 percent vacancy

Sarasota/Bradenton 27.9 percent

Lakeland ? 21.4 percent

Orlando ? 20.7 percent

South Florida (Miami-Naples areas) ? 19.5 percent

Palm Bay ? 17.8 percent

Tampa ? 17.6 percent

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I know we?ve been beating the ?Florida-real-estate-market-is-improving-a-little-bit-at-a-time drum for some time, but it?s really true.? Foreign investment activity is surging, and tourism (a key driver of Florida economic activity) is strong. So Florida has to be our top pick as the area to watch for buy and hold investing opportunities!

Reasons for the Buy and Hold Heat Wave

Investors who have been through a few hot and cold market cycles are well aware that buy and hold real estate investing goes through phases. This one is a little different, though, because the strengthening rental market is being driven by high foreclosure activity. Typically a weak economy will somewhat restrict demand for rentals, but in this case, that hasn?t happened.

The reason?

As homeowners are forced from their homes as the foreclosure process plays out, they have to go somewhere. Increasingly, that ?somewhere? has been into apartments as available single family home rentals dry up. Once the economy picks up steam, tourist hotspots (Florida, Arizona, Nevada) should see apartment demand pick up, reducing vacancy rates.

And this spells even higher rents.

Your Buy and Hold Forecast: Cool Profits

In order to make the most of buy and hold opportunities (no matter where you choose to invest), it?s crucial that you crunch your numbers to ensure that your investment will net positive cash flow. Then, even if the market drops (or your investment) temporarily loses value, you?ll still be able to count on a monthly infusion of cash.

You should also keep your eyes on local market conditions to make sure you maximize every opportunity to increase cash flow with increased rents. Higher demand = higher rents. And we all know that larger profit margins create lasting wealth for buy and hold real estate investors!

Press Release Coming!

As is a monthly Home Stand tradition, keep your eyes open for the latest Default Research press release. Each month, we profile a different area, and give hard numbers that conclusively show whether a market is improving, weakening or holding steady. This month is no different. The questions is: Which market will we profile? And will you be ready to take the information we give you to make you a better, more informed buy and hold investor? Stay tuned to find out!

Here?s a hint: July?s press release will have you wanting to ?motor? towards this iconic American city so you can ?sing? the praises of buy and hold investing opportunities!

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Source: http://newsletter.defaultresearch.com/2012/07/issue-54/

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