Learning how to find cash flow properties for sale is one of the best things an investor can do. Finding positive cash flow real estate is both an art and a science, but thankfully there are tools out there to reduce a lot of the guesswork. Use this list as a comprehensive guide of all the tools you’ll need in order to find cash flow properties for sale.
The Heatmap Analysis Tool
Real estate, more than anything else, is all about location. Studying up on the best cities to invest in real estate is an important first step, to this end. But even then, investment properties in different neighborhoods can have markedly different income potential. For example, in the Chicago real estate market, North Austin is one of the best neighborhoods to invest in while East Hyde Park is one of the worst. So choosing the right area within a city is crucial when finding cash flow properties for sale.
Consider using Mashvisor’s real estate heatmap analysis tool. Here’s how it works: First, you choose the city that you intend to invest in. The tool will automatically bring up a map of that city and when you hit the “Explore the Data” button (pictured below), the map will conveniently highlight areas based on their investment potential. You’ll be given crucial information, such as the cash on cash return, capitalization rate, and average house prices for whichever region you choose.
This tool gives you a lot of freedom to play around with different indicators and analyze what matters most to you. In order to find good cash flow properties for sale, you should study some of the indicators which point towards a profitable investment. For example, a high rental income combined with a high occupancy rate is a fantastic indicator of an investment property that will generate good rental income. Alternatively, a high listing price combined with a low average rental income is a good sign that you should avoid that property.
This is hugely beneficial in the early stages of your investment property search. It can be hugely lucrative to take a macro look at neighborhoods, therefore properly orienting yourself on where to look for the best cash flow properties for sale. Finding cash flow properties for sale will become a lot easier once you’ve found the right area.
Property Finder
Mashvisor’s property finder tool is a godsend for real estate investors, making it easier than ever to find cash flow properties for sale. Most listing websites will give you a brief and often unhelpful idea of a property. They’re designed for home buyers and property investors alike, meaning that investors won’t have all the tools they need for positive cash flow real estate investing. You’ll know its location and asking price, but everything else you need will still take some work and calculation to find.
Hence, this is why using a property finder specifically designed for investors can be so powerful when searching for cash flow properties for sale. You’ll have all of the relevant numbers and metrics needed to evaluate whether a property will be a good investment.
A great feature of this property finder is the ability to quickly compare an investment property’s potential as a traditional rental or an Airbnb rental. If you can make more money by listing on Airbnb — which is very often the case — this tool will let you know.
Investment Property Calculator
Knowing the right real estate investment tools can make your job significantly easier. In this context, an investment property calculator is a no-brainer for any investor.
Using an investment property calculator will give you some crucial information about the return on investment you can expect from a property. To this end, you’ll be given an investment property’s cash on cash return. This figure essentially tells you the amount of your return, in relation to the initial cash that you’ll have to invest in a property. You’ll also get your cap rate, which shows you your net operating income in relation to the property’s market value.
Importantly within this context, Mashvisor’s tool can give you access to a cash flow calculator. You simply input the variables needed to calculate cash flow, such as rental property expenses and the terms of your mortgage, and you’ll get a clearcut picture of what you’ll be pocketing at the end of the month. If your rental property cash flow isn’t where you want it to be, you can quickly move on to the next investment property.
Very importantly, this tool studies your real estate comps. This essentially means properties of comparable specifications and within a comparable location. This is crucial when you’re determining how much to charge for rent. An investment property calculator is, therefore, a great way to come up with rental income estimates.
Using this tool is also a great idea if you’re looking for cash flow investment properties to list on Airbnb. The calculator will do a comparison of what kind of rental income you can expect from traditional rentals, versus listing on Airbnb. Not many real estate investors are versed in the income potential of Airbnb, nor would they buy cash flow properties to list them. But you’d be surprised how lucrative the industry can be! Be sure to check your Airbnb cash flow when running your numbers.
Without using a premium service to crunch these numbers, you’ll need to run the numbers again and again until you’ve found the right rental property. Hence, using an investment property calculator can save a huge amount of time and guarantee you’re making an informed investment decision.
Imagine having to go through each investment property one by one to find this information? Sign up for Mashvisor now and avoid the hassle!
Conclusion
Cash flow from assets is one of the best ways to make money in real estate since the immediate cash flow allows you to take on investing as a full-time job. Thus the more you know your numbers — your return on investment, your expected rental income, your capitalization rate — the better off you’ll be when making investments!
Being a real estate investor can be complex and oftentimes stressful. Therefore it’s always a good idea to educate yourself on the tools you have available to you when seeking cash flow properties for sale. The easier you can make your research process, the more likely you are to find the perfect investment property for sale.