Off-market and Wholesale Investment Real Estate Property Blog
- Smart Money Podcast
- October 1, 2021
How to Find Off-Market and Wholesale Real Estate Properties for Investment
Choosing the right investment property is the most important part of real estate investing and finding off market properties! It's better to wait for the right deal then to jump into a deal that will end up costing you money.
FindOffMarket is Canada's Largest source for off-market and wholesale properties. We'll help you find the perfect investment property!
Here are a few things you consider before looking for an investment off market or wholesale property:
- Base Price
- Repair Costs
- After Repair Value (ARV)
- IRR (Internal Rate of Return)
- Investment Strategy (BRRRR vs Flip vs Rental)
What is the Best Location for an Investment Property?
Often times high cost of living (HCOL) areas will have lower rates of return than less densly lpopulated and low cost of living (LCOL) areas. This is because the upfront deposit and mortgage payments are ussually larger, while the rent is not significantly greather such that as a ratio it ends up worse. If you need help managing properties outside of your geographic region check out our blog post on Property Mangers who can help!
The Math and The One Percent Rule
The three most important factors when evaluating investment properties are base price, repair cost and after repair value. The potential profit = After-repair value (ARV) - repair cost - base price. Another important consideration is the One Percent Rule which is a measure of how much cashflow the property generates. The goal is to have the mortgage payments be less than 1% of the downpayment plus repair cost. For example on a $1M property with a 20% downpayment and no repair costs the 1% rule would stipulate the minimum monthly income should be = $1M x 20% x 1% = $2000 / month.
There are many different real estate investment strategies that can work depending on your risk appetite, avialalbe capital and experience level. Some of the most common include:
- BRRRR - Buy, Rehab, Rent, Refinance, Repeat
- Short term rental such as airbnb or cottage
- Long term rental
- Fix and Flip
- House hacking - Buying a multi unit property and renting out the rest of the units to cover rent
Where do I find the Best Investment Properties?
You can either work with a real estate agent to look for listed properties, this method will likely have many competitors bidding on the property and is costly as the agents collect commission fees.
Another option is to sign up for mailing lists of individual wholesalers, but this is inefficient and requires consistantly monitor your emails.
Alternatively the easiest, fastest and cheapest way is to use FindOffMarket! We have the largest listing database of off market and wholesale properties in Canada. We aggregate the information and provide powerful data analytics tools to help you find the most profitable properties in a matter of clicks! Check out some link here:
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