Experienced real estate investors know doing their homework pays, understanding that thoroughly checking off the list all of the details means avoiding nightmares that cost time and money. Moreover, these investors realize it all counts towards bringing the best possible return on their investment dollar. In this post, we share 5 Things Arizona Real Estate Investors Need to Check Before Buying Land.
1) Check Everything Twice
Before ever looking at an investment property, the numbers should add up. Due diligence for Arizona real estate investors means checking the numbers twice, backward and forwards. When you invest in real estate, while it is a bonus if you particularly like a property, you should be much more excited about the numbers. Once you have performed your due diligence tasks, you should carefully examine any numbers that do not match the original reports.
2) Walk the Property
The next thing you need to check in the performance of your due diligence for Arizona land investors is the property itself, walking physically around the entire property. Remember you are also buying the sights, sounds, and smells surrounding you, so you should pay attention to neighboring properties before signing on the dotted line. Unless you are an experienced investor, it is prudent to ask for input from a trusted investor, likely to spot red flags an inexperienced eye may miss, like the experts at Southwest Land Deals. Or if you’re in a situation where walking the property isn’t an option, let us know. We have access to multiple photos and maps to help you get a solid sense of the property. Bonus: the team at Southwest Land Deals have lived in Arizona for decades and we know all the areas. We can answer just about any questions you may have.
3) Flipping or Holding Costs
Due diligence for Arizona real estate investors should provide you with realistic estimates of any rehabbing costs, along with the costs to hold the property. Suppose you will be holding the property over the long term. In that case, it is essential to have an accurate accounting of annual expenses, such as hiring a professional property management company, any mortgage, taxes, maintenance, repairs, and even vacancies. If you are flipping properties, you should calculate an estimate of the time to repair and maintain the property until sold. Working with Southwest Land Deals means working with an entire team, swiftly providing you with reliable numbers.
4) Review Legal Documents
Due diligence also requires Arizona land investors to complete a thorough review of all available information and any legal documents associated with the property. For example, a title search will identify problems, known as clouds on the title, with any liens against the property for debt. In addition, title searches may reveal breaks that require correction and could be something as simple as the misspelling of a name. They may also disclose possible fraudulent ownership or serve to clear the chain of title or history of ownership of the property.
5) Exit Strategy
Last but not least, as with every investment you make, due diligence for Arizona investors should include planning your exit strategy. The real estate market does experience fluctuations, so you should begin with plans to remove yourself from this investment, remaining flexible and timely. As a business practice, professional investors like those at Southwest Land Deals continually monitor changes in the current Arizona real estate market. These trends and other outside influences help provide Arizona real estate investors an educated estimation of the just when to sell the investment property.