It’s often said that it’s much easier to find something if you know exactly what you are looking for. The same is true when you are trying to find wholesale investment properties. There are two primary strategies for real estate investors: One is to buy, fix, and sell and the other is to buy, fix, and rent out long term. Some houses are much better suited for long-term rentals and some houses are better suited for short-term flips.
Generally speaking, a long-term hold property should offer prospects for appreciation and be in the type of neighborhood that will attract quality tenants. Many beginning investors look at the cash-flow from cheap, small houses in distressed neighborhoods and believe this is the most important characteristic of a rental. The problem with this strategy is, cheaper houses in distressed neighborhoods do not appreciate at the rate of larger homes in better neighborhoods. It is also difficult to attract and keep quality tenants in these small, cheap houses. Therefore, if you are looking for wholesale investment properties to hold as rentals focus o n middle-income homes in quality areas or “upward-transitional areas”. Buying quality homes for cheap in neighborhoods that are transitioning to a higher profit neighborhood and area. This specific type of property for a long-term hold strategy has created many real estate millionaires.
If your plan is to buy, fix and sell then your focus lies in areas where homes are selling quickly. It is fairly easy to determine what the average days on market are in any specific zip code. Access to the MLS database, either directly or through a Realtor friend can quickly give you the data you need to find these fast-sell neighborhoods. I would recommend working with middle-income and up houses.