There are still investment properties that you can find with positive before tax cash flow. With the big increase in prices this past year, It's just not as easy as it was 2 years ago when we would have 20+ of them for you to choose from that easily had a 8%+ cash on cash return.
Most of the properties in the areas I specialize in that I come across worth running the numbers on that would make great rental properties are coming in a little under a 5% cash on cash return assuming 1 month of vacancy and 8% property management fees. For the nice ones we do come across that are fairly priced, competition to purchase is still very high especially if they are under $150,000. We did just pick one up coming in around a 6% cash on cash return in the mid $160K range that worked for the particular buyer that had some other requirements besides just positive cash flow.
If you wanted to finance / leverage for higher cash on cash returns, I'd have to know how much you are putting down and at what rate your loan was at to run numbers.
For now, it still makes financial sense to invest in Las Vegas homes because Return on Equity numbers are still better then parking cash in the bank, it just requires a little patience for the right opportunities to come up.
Rental prices have not been keeping up for the time being with all of the investment homes that have been purchased in the past few years and turned into rentals. As some have mentioned, the big institutional investors have backed off of purchasing single family homes. As the supply of rental homes available for lease goes down, rental prices will probably increase so those 5% cash on cash returns that can be found today will probably be improved on.
Economic numbers for Vegas are improving - Visitation numbers are up and this year's convention schedule for Las Vegas is projected to be a record year with 70 new conventions added to all of the ones that already come to Vegas every year that contribute over $6 Billion in non gaming revenue to the economy. Vegas made #10 for cities people are moving to so as long as more people are moving in then moving out, future numbers for what's purchased today should only improve.
Let me know if you have any questions.
Prudential Americana Group
The Las Vegas market is still a great market for positive cash flowing properties. Since the end of 2011 prices have been soaring due to low inventory and high demand. The hot seller's market that we were in has now slowed down and the bidding wars have also decreased. Now we see properties selling closing to appraisal value instead of 10% to 15% above in previous years. In early 2012 you could get 12- 14% CAP rates. Since home prices have increased and rental rates have decreased very slightly the CAP rates have decreased. If you are using accurate expenses and vacancy rates you will find on average homes are creating about a 4-5% CAP rate now. You can find higher CAP rates around 6-8% but this is higher than the average. A lot of people use different method of calculating the CAP rate so make sure all expenses are accounted for. If you want to read my latest thoughts on the Las Vegas market please click here: http://www.lvrealestatehelp.com/1/post/2014/02/las-vegas-rea If you are interested in putting together an investment strategy that will help you meet your investment goals please email me or send me your buying criteria via our buyer's form here: http://www.lvrealestatehelp.com/buying-real-estate.html I look forward to hearing from you!
Dual Licensed Real Estate Broker NV#62827 MA#9530304
NV Broker & Team Leader of The Adams Team at Rothwell Gornt Companies
When looking to purchase investment properties, location, monthly return and future gains
are some of the must elements that are essential to any investors.
Las Vegas is on the top 10 cities to invest with positive monthly return. Most properties in the Las Vegas area have increased by around 30% between 2012-2013 with the expected 7% increase in 2014.
For a FREE detail rental and sale market condition by zip codes including time on the market
in Las Vegas, contact me at 702-612-7099 or email me at firstname.lastname@example.org
Licensed in two countries
Realty Executives International
Prudential Americana Group Realtors
The Tonnesen Team - with over 30 years of experience helping families call Las Vegas "home!"
Have you been pre qualified for an investment property mortgage yet? That is the best way to start! Knowing what your monthly expenses will be will help you in answering this very question. We have all types of investor loans to serve a multitude of needs. Call me today, or click the link below and you can fill out your loan application in about 10-15 minutes and I can get you your approval today! I look forward to hearing from you.
Thank you for choosing City First Mortgage Services,
Nathan T. Kessler | Sr. Mortgage Loan Originator
City First Mortgage Services
8871 W Flamingo Rd Suite 202
Las Vegas, NV 89147
(C) 702.683.3126 | (F) 702.974.0848 | (O) 702-522-6743
Company NMLS # 3117 | Branch NMLS # 819501
Individual NMLS # 377217 NV #46175
Realty One Group
What % were you looking to get as you ROI?
Phil Scheinman, ABR, GRI, E-PRO
Broker * Sales Agent * Realtor
2831 St. Rose ParkwaySte. 100
Las Vegas, NV 89074
Las Vegas Is still a good buy for Rental Investments..
Feel free to call or email me when you have a moment....
I would be happy to discuss this in more detail and answer any questions that you may have about the Las Vegas Rental Market...
Have A Healthy and Prosperous New Year
Hank Lauzon III
Your Las Vegas Realtor
Signature Real Estate Group
9525 Hillwood Drive #120
Las Vegas, NV 89134
Web : http://HanksLVRealestate.com
Never look down on anybody...unless you're helping them up.
If you want to work with my investment group, I can offer you 40 years of Las Vegas experience.
a total package, buy, fix-up, property manage and sales.
David Cooper 1.888.616.6226