Buying Investment Property Learn How to Find Positive Cash Flow Properties in the US Real Estate Market by Hamza Abdul-Samad July 5, 2018August 12, 2018 by Hamza Abdul-Samad July 5, 2018August 12, 2018 Positive cash flow properties are the primary sources of rental income for real estate investors. These investment properties generate enough rental income to cover rental expenses, such as mortgage payments, and still provide a real estate investor with a profitable return. The best way to obtain positive cash flow properties is to find rental properties that are predisposed and expected to generate positive cash flow. How can you find these positive cash flow properties? Let’s get right into it! Prepare Your Finances Positive cash flow properties tend to exist in expensive and profitable locations. Therefore, it’s imperative for a real estate investor to prepare finances as well as possible to purchase the best property possible. The main concern with rental property finances is purchase payments, whether the property is bought with cash or a mortgage (to learn more about the differences between investing with cash and mortgage, read this: “Buy a Rental Property Using Mortgage or Cash?”). Real estate investors should also be prepared for other standards of rental property finances such as credit scores and down payments. Investors should aim for the standard of a 620 FICO credit score and a 20% down payment. Search for Profitable Locations Once your finances are set, you can start searching for positive cash flow properties in a desired location. There are two main methods used to find positive cash flow properties. The first is through advertisements and word-of-mouth. This method can be very useful in a local area, especially when uncovering hidden investment property opportunities. The better method, however, is to use a heatmap analysis. A heatmap analysis is used by real estate investors to find the best places to buy an investment property. Some heatmap analyses, such as Mashvisor’s, can filter the different aspects of an area, such as how profitable it is and what types of properties exist there. Want to learn more about Mashvisor’s heatmap analysis, among its many other functions? Click here! Using software such as Mashvisor is an excellent way to find locations with positive cash flow properties. If you want to take the extra step, though, more research must be done. The real estate investor must know, for instance, what kind of tenants are in the location. Are the tenants families looking for a place to reside or tourists looking for nightly rentals? Knowing such information will help the investor know what locations to keep in mind. Pick a Property Now you can narrow down the available investment properties in the area. Be sure to stick with positive cash flow properties with a property type that is in demand in the location. For example, if you’re in a school district, you may want to buy a single family home or condo. The best way to search for an investment property in a given location is to use a property finder. Of course, Mashvisor also offers a quick and efficient property finder. Mashvisor’s property analysis is similar to its heatmap analysis. It can search for properties based on various financial criteria such as rental income, cash flow, return on investment, expected rental expenses, and more. The property finder can also scour for rental properties based on physical features such as property type, square mileage, and number of bedrooms and bathrooms. Need help searching for income properties? Check out this blog with helpful tips: “5 Tips on Researching Investment Properties”! Analyze the Property To ensure a rental property earns positive cash flow, it must be properly analyzed. The real estate investor must know how much is expected in rental income and rental expenses. The best tool used to break down data is the investment property calculator. The calculator, with the help of traditional and predictive analytics, estimates and computes vital pieces of information for rental properties. Once again, this is a function that Mashvisor provides in an efficient and accurate manner. Another important part of investment property analysis is choosing a rental strategy for positive cash flow properties. Choosing an investing strategy is sometimes based on the investor’s liking. While there is nothing wrong with basing the decision this way, the better way is to let data help you decide. This is easily performed with Mashvisor’s investment property analysis. The optimal rental strategy, based on factors including investment goals, is displayed with each property in Mashvisor’s search. Don’t know that much about rental strategies? Read this blog to learn all you need to know: “Top Six Real Estate Investment Strategies”! Proper Maintenance While this isn’t a step towards finding positive cash flow properties, this is the most important step towards maintaining them. Proper maintenance ensures high rental income and minimizes rental expenses, which leads to having positive cash flow. All the previously mentioned steps, including preparing finances, finding profitable locations, narrowing down investment properties, and analyzing the investment property, will significantly influence the property’s maintenance. Summary Finding positive cash flow properties isn’t the easiest part of real estate investing, but it is doable and vital. A real estate investor should start with preparing finances, including building up credit, saving for a down payment, and securing a mortgage. Once that is taken care of, the investor can begin the hunt for profitable locations. Using a heatmap analysis is the best bet for finding locations, but other bits of information, such as the location’s job market, will also serve an investor well. Then, the investor can narrow down choices and use an investment property calculator to understand the property’s profitability projections. The path to positive cash flow does not end after the purchase: the investor must properly maintain the property. Making money in real estate is best done with the help of positive cash flow properties. For more information on how to find these properties, with in-depth details on every step mentioned in this blog, click here. To get yourself started with finding positive cash flow properties today, click here! Start Your Investment Property Search! START FREE TRIAL Start Your Investment Property Search! START FREE TRIAL Location 0 FacebookTwitterGoogle +PinterestLinkedin Hamza Abdul-Samad Hamza is a long-time writer at Mashvisor. With a focus on real estate investing tips, concepts, and top investing locations, he aims to help all aspiring investors who come across his blogs to hit the bank with their investment property. Previous Post Choose the Best Way to Make Money with Real Estate Next Post Want to Be Rich? Start Real Estate Investing in Your Twenties Related Posts Neighborhood Analysis in Real Estate Investing The Best Rental Markets in Texas: The 2022 Guide Advice for Real Estate Investors: Buy or Rent a House? How Exchange Rates Affect Real Estate House Hunting Has Never Been Easier: Just Follow These Steps Renting Out Your House vs. Buying a Rental Property: Which Is Right for You? How Do You Find a Buyer’s Market in the US Housing Market in 2018? Where Do You Find the Best Investment Properties For Sale? How to Do an MLS Listings Search: A Real Estate Investor’s Guide Abandoned Houses: Should You Invest in One? How? 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