Guide To Investing In Cape Coral

If you have decided to invest in Cape Coral, you should know that the money is made or lost behind the scenes and not when you close the deal. To give you an example, let’s say that after selling a house you have made a $10,000 profit. But, after giving $5,000 to the real estate agent, another $5,000 to the contractors and $1,000 to your attorney, it means that you lost money on this deal.

There is a lot of common sense involved when you start investing in real estate improvements to the house, like getting new cabinets, doing some landscaping, some tiling or any other actions that will increase the value of the property. It is best to hire some professionals to do these things for you. Although you will be spending some money at first, the results will come later on when you sell the house. There are a couple of things that you can take care for yourself, like putting in new plants, painting the walls or changing the locks so at least for these things you shouldn’t hire someone to do it.

Before investing in this city, you need to learn more about its market. Although you might read on the internet just about everything there is to know about Cape Coral, you will be surprised to learn how competitive the business can be once you embark on it. You will have to face up both individuals and businesses that have been in the market way longer than you have. Although you cannot gain their experience over the night, you have the possibility to educate yourself on many of the possible trends and issues.

For this reason, you should check out the home prices in Cape Coral by following the sales on the Internet or in the newspapers. In addition, look at the fair rental prices and if you have the time, visit some of these homes that you think to be similar with the one that you plan on listing. Also, drop by the local banks in order to find out about the required down payments as well as the loan volume. With this knowledge you will be able to avoid paying too much and in some cases, even negotiate a better deal.

Don’t forget about the 1% rule. All you will need is two numbers: the price for the house and the rental income you will be getting each month. If the monthly income consists of 1% of the purchase price it means that you got a good deal going on. On the flip side, let’s say that you have a house that costs $300,000 and the rent per month is $2,100 – it means that you will be getting only 0.7%. In this case you should probably still stick with the house but you need to know that money is going to be tight. Anything less than 0.7% is not worthy risking as it will be hard to make cash flow without a higher rent, a lower purchase or a significant down payment.