Buying a townhouse can be the best real estate investment you make. However, the process of finding a profitable one is easier said than done. So, how can investors find townhouses for sale? The answer lies in Mashvisor’s 3 real estate investment tools. These include the real estate heatmap, rental property finder, and investment property calculator. In this blog, we’ll talk about how these tools will help you find the best townhouse investments out there!
Related: 5 Best Real Estate Investment Tools for 2020
Townhouses for Sale – In a Nutshell
Before we discuss the 3 tools, let’s briefly talk about townhouse investments.
What are townhouses for sale? Also known as row houses, townhouses are properties that are composed of multiple units attached together. Each unit, or property, shares at least one wall with an adjacent unit. Row houses can exist in complexes, providing each unit with its own backyard space.
To most real estate investors, townhouse investment properties are a mix of single-family homes and condos. However, they are technically a type of single-family rental. Townhomes for sale are usually smaller than their SFR counterparts. Therefore, they are generally cheaper to build. They also tend to generate less demand from buyers than typical SFRs. Because of this lower demand, investors won’t have as much of a headache when buying a townhouse.
3 Real Estate Tools to Find Townhouses for Sale
Above all, townhouses for sale are very profitable real estate properties when you rent them out. So, how can you find townhomes for sale? Mashvisor’s 3 real estate investment tools are all you need!
1. Real Estate Heatmap Analysis
A real estate heatmap analysis is the ultimate location search tool. Mashvisor’s heatmap allows users to analyze any neighborhood in the US housing market. As a heatmap, it displays data in a color-coded form. Mashvisor’s real estate heatmap uses red and green when presenting data.
Mashvisor’s Real Estate Heatmap
When analyzing neighborhoods with townhouses for sale, Mashvisor’s heatmap focuses on three metrics: listing price, rental income, and return on investment (ROI).
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Listing Price
When buying a townhouse, the listing price is the most eye-catching piece of data. It is also the most important. Whether or not a townhouse’s listing price makes for a good deal will trickle down to its rental income, ROI, and appreciation. Therefore, real estate investors need to find townhouses for sale that are within their budgetary and investment goals. With Mashvisor’s interactive real estate heatmap, investors can find the best locations for townhouses for sale that they can afford.
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Rental Income
Investing in a townhouse is all about its high rental income. Rental income can be determined manually using listing price and property valuation. However, this method does not consider location and investment trends. Using a heatmap analysis, on the other hand, does take these bits in mind. As a result, Mashvisor’s heatmap finds neighborhoods with rowhouses that are geared for high rental income.
Related: Real Estate Investing 101: How to Calculate Rental Income
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Return on Investment
Rental income is obviously important. However, it isn’t the best indicator of profit. Return on investment evaluates profitability. Like rental income, ROI is significantly affected by location. As it does for rental income, Mashvisor’s real estate heatmap finds areas that have townhouses with a high ROI.
2. Rental Property Finder
Mashvisor’s heatmap analysis helps real estate investors choose an investment location. The next step in buying a townhouse as an investment is to find a townhouse. Mashvisor’s rental property finder is the perfect tool for this job. A rental property finder does exactly what it says. It allows investors to conduct an investment property search in a specific location. Mashvisor’s rental property finder is particularly helpful for investors. Its efficiency, accuracy, and accessibility make it the best of its kind. When searching for townhouses for sale, the finder performs two main functions. Firstly, it finds the best row houses with specific filters. Then, it allows investors to compare various similar properties.
Mashvisor’s Rental Property Finder
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Find Row Houses Using Specific Filters
Finding income properties is similar to finding a location. Both require detailed analysis and research. However, there is generally more that goes into finding row houses for sale. Mashvisor’s rental property finder, therefore, reflects this increased detail through its property filters. Mashvisor’s investment property search tool has a wide range of filters. The finder is also interactive. This allows investors to find row houses based on their specified filters which include:
- Location
- Budget
- Rental Strategy
- Property Type
- Number of Bedrooms
- Number of Bathrooms
With such interactive filters, investors can find the best townhouses for sale that meet their investment goals.
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Property Comparison
Once you’ve set the filters, you’ll be shown a list of prospective townhouses for rent. You can quickly compare the properties to choose a few of the best ones that meet your criteria before moving onto an in-depth analysis,
3. Investment Property Calculator
Finally, after finding a location and townhouse, you can begin to analyze it. This is done with the last, but not least, of Mashvisor’s real estate investment tools: the investment property calculator. The investment property calculator, also known as the rental property calculator, is all you need for a townhouse property analysis. The calculator breaks down property data using comp and market trends. It also depends on user input to provide the most accurate results possible.
Mashvisor’s Investment Property Calculator
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Mashvisor’s Input Data
Mashvisor’s calculator depends on two forms of input data. Both of these data are required to estimate profitability metrics. The first of these input data is financing information. Investors should mention whether they will buy a townhouse using cash or mortgage. For mortgages, the user can insert the loan type, amount, interest rate, and down payment.
The second form of input data is rental expenses. These include one-time fees and recurring costs. One-time fees include inspection and closing costs. Recurring costs, on the other hand, include anything used to maintain the townhouse over time. Note that our calculator provides estimates but also allows investors to adjust them as they see fit.
With such input data, Mashvisor’s investment property calculator can estimate the profitability of a townhouse investment property.
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Mashvisor’s Output Data
Once the input data has been computed, Mashvisor can project the profitability of the property. The investment property calculator estimates profitability in three ways: cash flow, cap rate, and cash on cash return. While these metrics are different, they are essential for estimating the profit of renting out a townhouse.
In addition to ROI metrics, the calculator will also provide real estate comps to help you find the best townhouse real estate investment.
Related: How to Determine the Profitability of Real Estate Investments
Are you asking yourself, “Where are the best townhouses for sale near me?” To get the answer, CLICK HERE to start your 14-day FREE trial with Mashvisor’s real estate investment tools!
