Residential income properties can be a great investment option if done right. However, one of the reasons why most first-time real estate investors fail to succeed in this field is because they fail to understand how to find income property for sale with a good return rate. While real estate investing can be lucrative, not all investment properties for sale will yield good returns.
Finding income properties with a good return on investment boils down to how you conduct your property search. For beginners who are still trying to figure things out, conducting a property search can be daunting. In light of the amount of research that is needed to find the best investment property from the enormous pool in the real estate market and the available competition, it’s easy to get discouraged before you even take the first step.
However, your investment property search doesn’t have to be complicated. If you follow the right process and use the right tools, you can do it efficiently in a matter of minutes. Technology and the internet have made it possible for anyone to find profitable income property for sale regardless of their experience.
So, how do I find income property for sale near me in 2020?
Well, use Mashvisor’s real estate investment tools! In this article, we look at 4 tools that real estate investors need to use to find income properties for sale in 2020:
Using Mashvisor’s Tools to Find Income Property for Sale in 2020
1. Use the Real Estate Heatmap to Find a Profitable Rental Property Market
The first step to finding an income property for sale is finding a profitable location. Location is the single most crucial variable when searching for income properties for sale. The location of an investment property will not only determine whether you can afford it but will also impact its return on investment. Therefore, you need to do a thorough real estate market analysis to find the best investment location.
Related:Location Location Location: What Makes for the Best Place to Invest in Real Estate?
The best tool to use for finding a profitable real estate market is Mashvisor’s real estate heatmap. But before you use the real estate heatmap, you will need to pick a city with good investment performance. You can do this easily by checking for up-to-date city data on Mashvisor’s blog.
After you have settled on a city, you can use our heatmap analysis tool to find the best-performing neighborhood in that city with just a few clicks.
So, how does Mashvisor’s real estate heatmap work? Well, it’s quite simple. The heatmap analysis tool displays property data using visual cues and a variety of colors instead of just numerical data. The color-coding system is used to represent different values for different key metrics. This makes it easier for users to quickly figure out the best-performing neighborhoods in their city of choice based on the selected metrics.
Mashvisor’s Real Estate Heatmap
The colors range from green (showing areas with highest values) to red (showing areas with lowest values). Areas with moderate performance are presented in orange and yellow.
The metrics used as filters include:
- Listing Price
- Rental Income (Traditional and Airbnb)
- Cash on Cash Return (Traditional and Airbnb)
- Airbnb Occupancy Rate
Related:Finding Income Properties in 2020 with a Heatmap
2. Use the Rental Property Finder for Your Property Search
The real estate heatmap will help you find a profitable neighborhood where you can begin your search for income property for sale. But that’s just the first step. You still have a long way to go. With the prospect of multiple income properties for sale in your target area, for sure not all of them are going to help you meet your specific investment goals. So, how do you narrow down your search? The answer is: With Mashvisor’s rental property finder.
The rental property finder uses predictive analytics and the latest machine learning algorithms to help users find income properties for sale with the highest potential for profits that match your criteria. By using the following filters, you will be able to find high return income property for sale in any US housing market:
- Location (you can search in multiple cities at once, an unlimited number with an Expert Plan)
- Budget
- Rental strategy (Airbnb or traditional)
- Property type
- Number of bedrooms and bathrooms
After setting the filters according to your preferences, you will get a list of income properties for sale that match your criteria. The list will be sorted automatically according to the potential cash on cash return. If you have been thinking of how to find income property for sale in 2020, be sure to also include Mashvisor’s property finder on your list of must-have tools.
Mashvisor’s Property Finder
Search for My Investment Property
Related:How to Find Investment Properties Using a Property Finder Tool
3. Use the Investment Property Calculator for Investment Property Analysis
The final most important step in our guide on how to find income property for sale in 2020 is conducting an investment property analysis. After using our rental property finder, you will have a smaller list of properties that meet your investment criteria. However, to find the best income-producing property among these, you will need to conduct some in-depth research.
You need to assess the profitability potential of each of your income property for sale relative to other comparable properties in the neighborhood. This is where Mashvisor’s rental property calculator comes in handy. To perform investment property analysis using our calculator, you simply key in basic data like the method of financing, down payment, and any additional property expenses beyond the estimates provided.
The calculator will then provide you with the following key numbers:
- Cash flow
- Cap rate
- Cash on cash return
- Occupancy rate
The cash flow, cap rate, and cash on cash return metrics are provided for both Airbnb and traditional strategies as well as the occupancy rate. Therefore, you’ll be able to know the optimal rental strategy for each rental income property for sale you analyze.
Mashvisor’s Investment Property Calculator
If you want to make money in real estate in 2020, you got to capitalize on positive cash flow income properties. And there’s no better way to find cash flow income properties for sale than using Mashvisor’s calculator. Try it out now.
Related:Mashvisor’s Investment Property Calculator: Real Estate Investing Made Easier
4. Use the Property Marketplace to Find Off-Market Income Property for Sale
Another option to consider when thinking of how to find income property for sale in 2020 is off-market deals. It’s a fact that some of the best real estate deals don’t even find their way to the MLS. Therefore, savvy investors have mastered the art of finding off-market income property for sale before anyone else learns about them.
The good news is that you too can find off-market deals from the comfort of your home. You can do so by searching in the Mashvisor Property Marketplace. Here, you can find a variety of off-market listings in the US housing market such as:
- Foreclosures
- Short sales
- Bank/REO homes
- Auctioned homes
The tool allows you to customize your search to match your investment criteria by using filters like:
- Location
- Miles
- Budget
- Listing type
- Rental strategy
- Investment property type
- Number of bedrooms/bathrooms
- Return on investment (cap rate and cash on cash return)
Mashvisor’s Property Marketplace
Moreover, you will be able to analyze any of the off-market income property for sale on the platform using our investment property calculator.
The Bottom Line
When you begin your investment property search in 2020, your goal should be to find the best income property for sale at your disposal. With these 4 investment property search tools, you will be able to find the most profitable income property for sale in the US.
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FAQs
How to Find Income Property for Sale in 2020? ›
What Types of Commercial Properties Are the Most Profitable? High-Tenant Properties – Typically, properties with a high number of tenants will give the best return on investment. These properties include RVs, self-storage, apartment complexes, and office spaces.
What are the most profitable income properties? ›What Types of Commercial Properties Are the Most Profitable? High-Tenant Properties – Typically, properties with a high number of tenants will give the best return on investment. These properties include RVs, self-storage, apartment complexes, and office spaces.
How do you get passive income from real estate? ›There are a few ways to invest in real estate passively. These include real estate investment trusts (REITs), crowdfunding opportunities, remote ownership and real estate funds. With these types of investments, you can make extra income without doing any physical labor or acting as a landlord.
How do you generate property income? ›- Leverage Appreciating Value. Most real estate appreciates over time. ...
- Buy And Hold Real Estate For Rent. ...
- Flip A House. ...
- Purchase Turnkey Properties. ...
- Invest In Real Estate. ...
- Make The Most Of Inflation. ...
- Refinance Your Mortgage.
Terraced houses are now the most in-demand property type
The most in-demand property types in 2023 mirror this shift. Over the last 3 months, the most sought-after property type was a 3-bed terraced house, with a tenth of all buyers expressing an interest in buying this style of property.
Single-family homes actually can be a high-income-generating real estate asset as there is no professional property management aspect. You can easily manage your properties. This will help save money on rental property expenses and will increase your net income.
What is the 2% rule? ›The 2% rule states that the monthly rent for an investment property should be equal to or no less than 2% of the purchase price. Here's an example of the 2% rule for a home with the purchase price of $150,000: $150,000 x 0.02 = $3,000.
How much profit should you make on a rental property? ›The amount will depend on your specific situation, but a good rule of thumb is to aim for at least 10% profit after all expenses and taxes. While 10% is a good target, you may be able to make more depending on the property and the rental market.
What is considered a good ROI on rental property? ›Generally, a good ROI for rental property is considered to be around 8 to 12% or higher. However, many investors aim for even higher returns. It's important to remember that ROI isn't the only factor to consider while evaluating the profitability of a rental property investment.
How to make $100 000 a year in passive income? ›- Invest in Real Estate. Rental properties generate income through tenants who pay rent each month to live in a property you own. ...
- CD Laddering. ...
- Dividend Stocks. ...
- Fixed-Income Securities. ...
- Start a Side Hustle.
How to invest $1,000 to make passive income? ›
Index funds are a passive, broad market investment through the major indices, while ETFs offer more choices to customize a portfolio. With $1,000, you can choose multiple ETFs with different risk profiles. You might invest $250 in a higher-risk, growth-oriented ETF, $250 into a dividend ETF, and $500 into a bond ETF.
What is an example of income property? ›Residential income properties may be single or multifamily homes, condominiums, townhomes, apartments, or seasonal homes such as cottages.
How long does it take to make a profit on a rental property? ›Most of the time, you can get positive cash flow right from day one with your rental. Figuring out your profit for the year is a matter of taking how much rent comes in and subtract how much money goes out for expenses like taxes, insurance, and mortgage payments. What you're left with is your profit for the year.
What is the fastest way to make money in real estate? ›- Wholesaling. ...
- Flipping Houses. ...
- Short-Term Rentals. ...
- Rent-to-Own Lease Options. ...
- Real Estate Investment Trust (REIT) ...
- Bird Dogging.
- 65% Stocks (Equity)
- 25% Bonds (Fixed income)
- 10% Cash.
- Real estate agent.
- Real estate broker.
- Real estate attorney.
- Real estate developer.
- Property manager.
- Real estate consultant.
- Mortgage loan officer.
Real Estate Broker
A real estate broker is permitted under law to negotiate and organize real estate dealings. A career as a real estate broker is one of the highest paying and lucrative professions in the real estate industry. On average, experienced brokers take home a six-figure pay.
Industrial Properties
With the rise of online shopping, demand for storage and distribution spaces closer to consumers has surged, making industrial real estate a potentially lucrative sector for investors. Lease agreements with reputable companies and long-term tenancy can provide stable income streams.