In this economy, especially in the real estate world, everyone seems to be looking for a deal. Both seasoned investors to first time home dwellers want us to break out the crystal ball and see what area or specific property will be the best deal.
Historically, investors make up more than 20 percent of all homes purchased in the United States. No matter what the market, investors need to perform their due diligence when seeking out investment possibilities. It often takes a lot of legwork to check out the various neighborhoods, crime statistics, schools, and rental market. Savvy investors and their agents need to run the numbers to determine a righteous value.
In this market, investors need every edge and we discovered a good one – SmartZip.com, an analytics-based investment ratings for real estate. Think of it like Morningstar but for real estate.
We checked out the site (still in Beta mode), which rates the top markets for real estate investment for residential real estate investors in California and Florida (more states coming soon). The analytics uses about 100 factors to determine the best investment values.
We tooled around the user-friendly site several times and plugged in several addresses and areas. We like their colorfully coded “heat maps,” to focus on the areas that they see high appreciation potential. Not playing the appreciation game and just want some steady positive cash flow — SmartZip can analyze that focus as well.
SmartZip helps identify the best markets and best properties, quickly computes what rental income and expenses to expect, projects long-term cash flow and appreciation, and assesses how to maximize after-tax returns.
Even with all of the tools and features, we don’t think that it would be a solid idea to invest based solely on the info and the SmartZip Score but in conjunction with an agent who knows the local area. For example, we plugged in an address in the Merced area but the rental income that SmartZip populated the rental income with an amount we considered high. No problem, we simply adjusted the amount. But we only know that info from doing our local homework.
We found the system useful and we’re already on it with some of our investor clients. We will be extra psyched when they roll the other 48 states out. But for now we’re happy that another cool, useful site originated here in the Bay Area.