The sometimes precipitous and unusually persistent decline in the values of California investment properties has opened up a multitude of opportunities for the shrewd real estate investor. In fact, there are a variety of profitable strategies available to those investors with the right experience, expertise and available funds.
Buy and Hold
The most typical type of real estate investment especially for the first time investor. Simply purchase a property at a reasonable or discounted rate and hold the property while it increases in value. This is an ideal investment vehicle for those with access to traditional sources of funding and a long term outlook.
Buy and Flip
For the more adventurous, buying a property and “flipping” it in a short time frame has the opportunity to be the most money-making type of real estate investment. Investors whose investment monies are otherwise tied up but with excellent credit should consider hard money loans to facilitate these rare but uncommonly profitable transactions.
Rehab for Rental Income
Rehabilitating an abused or forgotten property can be an extremely lucrative undertaking but do not be misled, there is a significant amount of work to be done by the investor as well as his construction crew. An excellent selling point for this type of investment is that the rehab can be done in stages and as rents are collected, they can be used to complete the later stages of the project.
Rehab for Resale
Rehabbing a property for resale is another excellent candidate for the use of hard money loans. The property can be used to obtain a first trust deed loan, rehabbed and then sold. The rate of interest on the loan is not particularly relevant as it will only be serviced for a relatively short period of time.
The acquisition of multiple dilapidated California investment properties or just raw land to create a larger lot for development purposes is agglomeration. An investor need not understand the details of actual development as the strategy is merely to accumulate contiguous properties and then sell them to a traditional development company.
Finding, buying and developing a vacant or underused property can be the Holy Grail of real estate investment. Certainly, many fortunes have been made with this strategy. Still, it takes careful planning, years of experience and plenty of money. In short, it may only be a strategy for a brave minority.