Buy Homes In Virginia

For More Information to buy homes in Prince William County Virginia Call:

1-888-403-1264

(enter zip code from the right)

Buy Homes in Virginia is your guide to home buying in Prince William County in Bristow, Broad Run, Catharpin, Dale City, Dumfries, Haymarket, Gainesville, Manassas, Manassas Park, Nokesville, Ridgeview, Triangle and Woodbridge. The entire county is covered.

Prince William County Statistics

–Average Income Families W/Children $73,796

–Average Age 32

–Percent Married 62.4

–Percent With Children 44.9

–Percent High School Graduates 92

–Percent College Graduates 41.8

–Average SAT Scores 1015
–Expenditures Per-Student $8,311

–Land Area 337.8 sq. mi.

–County Population 280,813

–Population Density Per Sq. Mile 831

–Population Growth Rate
(5 years) 3.0 %

Call 1-888-403-1264 and enter a zip code to Buy Homes In Prince William County Virginia

by Attorney William Bronchick

So often beginning investors focus on real estate investing techniques that they lose sight of the important issue – is this a good deal? Learning to recognize a good deal takes research, education and, above all, experience. Here’s a good formula to determine whether a potential real estate purchase is a deal. It’s a simple acronym called “C.L.E.A.R.”

CASH FLOW

Ask yourself, will this property cash flow? Well, that depends on a lot of factors, such as the strength of the local rental market, the interest rate on the financing and how much of a down payment you make. Also, it depends on whether it is a single family or multi-family dwelling. All of these factors considered, ask yourself, “will this provide income for me?”

Also, ask the question, “how will this property cash flow compared to other potential properties?” For example, a $150,000 house that rents for $1,000/month has a better income potential than a $300,000 house that rents for $1,600/month. A four-unit building that costs $400,000 may bring in $3,000/month in the same neighborhood.

Now, of course, whether the property will provide income to you begs the question of whether income is important to you. Is it? Do you earn other income? Do you need more income now, or is future equity growth more important? There’s no right answer to these questions, but are all factors to consider when looking at a potential purchase.

LEVERAGE

Leverage is important in investing because the less cash you put down on each property, the more properties you can buy. If the properties go up in value, your rate of return goes up exponentially. However, if the properties go down in value and you have a lot of debt on the property, this can result in negative cash flow (see above). Since real estate is generally cyclical, negative cash flow is only a short term problem and can be handled if you have other income or a cash reserve to handle the negative. “Nothing down” investing is very attractive for the high-leverage investor, but should be approached with caution.

If you are a long-term player, leverage will generally work in your favor if the markets in which you invest appreciate in the long run and your income from the properties can pay for most of the monthly debt service.

EQUITY

Does the property you are purchasing have equity? Equity can take a number of forms, such as:

There are many ways to create equity, but buying INTO EQUITY is your best bet. Find a motivated seller that wants out of his property and is willing to give up his or equity for less than full value. Or, buy a property that needs work that can be done for 50 cents on the dollar or less. In other words, if the property needs $10,000 in work, make sure you get a $20,000 discount on the price or better.

APPRECIATION

Buying in the right neighborhoods and in the right stage of a real estate cycle will result in appreciation and profit. However, timing a real estate cycle is difficult and can be very speculative. If you buy properties without equity or cash flow solely for short-term appreciation, you are engaging in a very risky investment.

Buying for moderate long-term (10 to 20 years) appreciation is safer and easier. Look at long-term neighborhood and city-wide trends to pick areas that will hold their values and grow at an average 5 to 7% pace. Combine this tactic with reasonable cash flow and buying into equity and you will be a smart investor.

RISK

Risk is a consideration that too few investors consider. Ask yourself, “what if my assumptions are wrong?” In other words, do you have a “plan B”? If you bought for appreciation and the property did not appreciate in value, can you rent for positive cash flow? If you buy with an adjustable rate loan and the rates go up, will this put you out of business? If you have a few vacancies, can you handle the negative cash flow, or will it break the bank for you? Expect the best, but prepare for the worst.

Remember, whenever you look at a property to purchase, think “CLEAR.”