Is There Really Such Thing As A "No Brainer" Real Estate Investment?

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If you want a smart and safe real estate investment in Tallahassee, you should acquire a quadruplex.

I was talking to a long-time friend last night about the crazy-good returns that are now available in the Tallahassee real estate market, and it made me think it would make a great blog post for the weekend. Everybody who has the means should acquire a quadruplex in Tallahassee right now, and the analysis below explains why.

Why You Should Acquire A Quadruplex In Tallahassee

The real estate market is in turmoil, with values dropping more than 30% in most neighborhoods in Tallahassee. It is not a good time to sell an investment property, but it sure is a great time to add the right one to your portfolio.

I was speaking with a lender the other day, and he told me a well qualified investor can borrow FHA money at 4% (with a 25% down payment). At 4%, you can really get dynamite returns.

So how do you optimize the benefits of this great FHA loan? Simple, you acquire a quadruplex.

You can acquire a quadruplex (four unit residential dwelling) and finance it with this great loan product. And here is my simplified view on what you should expect from your long-term investment:

If you acquire a quadruplex and own it for ten or more years, I believe you will see historically normal appreciation from current values (see video on real estate market cycles). By leveraging your purchase (only using a 25% down payment), the long-term appreciation (see numbers above left) will represent roughly a 13% return on investment.

Additionally, you can expect another 10% from your cash flow, and 5%+ from your principal reduction (the amount of your mortgage payment reducing the balance owed). All of these together show a first year return of 27%, which means you should anticipate better than 30% ROI when you acquire a quadruplex and hold it until we reach a sellers market.

How To Acquire A Quadruplex In Tallahassee

Of course, you cannot simply buy just any four unit building and get this return. The key is to buy at the right price and in an area that has a strong chance of sustaining great tenants for many years.

Nobody knows or analyzes that Tallahassee real estate market better than we do at Century 21 Manausa and Associates, so if you think you would like to acquire a quadruplex, just drop me a note and we can schedule a time to review the exciting opportunities for real estate investors today.

Joe Manausa, MBA
Century 21 Manausa & Associates
www.manausa.com