When investing in real estate anywhere, there are two important factors to consider before anything else:

1. Does your real estate agent have the knowledge in investing as well as the market knowledge of the are you are looking in? If your REALTOR® does not know the market, he or she can lead you to investments which may look good on the surface, but could cost you everything later. If they are not familiar with your investment goals, and investment property valuations, the outcome could be the same.
2. What economic engines drive the area? If you are not familiar with an area you are investing in real estate in, it is important to know what economic factors will sustain your investment and show a positive return on your money.

As a full time real estate broker and real estate investment analyst on the Mississippi Coast, it is my job – my duty, to maintain market knowledge, research new economic factors that could positively or negatively effect your investments, and discuss your investment strategy with you to determine exactly what your short and long term goals are. My clients have successfully seen positive returns on their investments, despite economic slow-downs, because I not only find great deals for them, but also because I help them see a larger picture of what is going on. I don’t always have the answers people want to hear, but I always speak my true opinions. I look at every deal as if it were my money on the line and never steer towards a property that I would not invest in myself.

Economic engines are important because regardless of what they are – this is what drives rentals and sales. If a new employer is coming to the area, and you know their workers’ estimated salary, it is feasible to buy properties that would fit in their rental needs or develop properties (build) to suit purchase needs. If a major employer is shutting down and 1000 jobs are to be lost, you know that you need to avoid properties that typically would cater to them.

South Mississippi has a variety of positive economic engines including gaming and tourism, ship building, government contracts, and two military bases on the coast (Navy CBC and Keesler AFB). The coast is also rich in the seafood industry, offers almost unsurpassed entertainment, and arts & culture.

South MS is an excellent place to feel comfortable with your real estate investing needs and despite economic slow downs in the rest of the country, the MS Coast saw relatively little impact compared to other major destinations. We have some of the most undervalued property in the country and as others are starting to become aware of this, values will continue to rise.

Contact me to discuss your real estate investment needs and let me help you build wealth through your real estate portfolio.

Knowing how to invest properly in real estate includes one important step that many investors forget – picking the right agent. Many investors choose properties to purchase based on what everyone else is doing or based on a sales flier they received from a listing agent telling them what a great deal it is, when both of these actions are the furthest away from what you want to do – unless you just like losing money.

The truth of the matter is, that many agents do not know how to properly valuate investment property or know how to analyze an investors individual needs. While I focus primarily on properties that will generate cash flow and the best potential for appreciation, I also realize that some investors are fine with an after tax cash flow if they can see a greater short term return on investment.

My investment strategy in my late 20′s was to look for things I could make a quick return on and get out of but as I got older I realized that longer term passive income was better for my overall strategy and I was fine with less appreciation potential as long as it could comfortably generate a revenue stream for me. In 10 years, I may have a different outlook. The point is, everyone’s goals are different and it is important to know what those goals are in the beginning and this is why I am a great choice as an investment REALTOR® on the Mississippi Coast. I work from Bay St Louis to Ocean Springs and can help you formulate a plan to maximize your goals.

Contact me and lets get started evaluating your needs so that I can assist you in meeting your real estate investing goals.

With tax advantages (Go Zone) and other incentives (SRAP, MDA), many investors fell prey to unscrupulous or unknowledgeable agents and brokers pushing properties just to take advantage of these incentives. It is unfortunate that this happened, but in some ways it has made it a great market place for serious investors who work with a broker who truly helps minimize risk and secure the investors objectives.

There are so many ways to make money in real estate investing. I am familiar with many, but my specialties lie in the analysis of residential (single family and multi-family) properties. This includes developing raw land for residential use as well. I will touch on just a few here that offer exceptional opportunities.

Go Zone
Go Zone has been extended through the end of this year. It is expected that this will be the last extension so if you are looking to take advantage of this, NOW is the time to do so. Go Zone offers the ability to depreciate 50% of the improvements on a property in the first year. The property has to have not been put into service (see more info on Go Zone). This depreciation can be carried back to recoup taxes as well as forward to help mitigate future tax liability. Just because it sounds good though – don’t always jump just because it looks good on paper!

Go Zone is an excellent incentive when used as a part of your overall real estate investment plan. Some agents have no problem selling you an overpriced property that will never cash flow, just so you can get go zone depreciation. Stay away from multi-family right now. The market is inundated with duplexes and fourplexes from people buying overpriced for Go Zone. Unless you have something really special – stay away. It simply makes no sense to spend $80k-$100k a door when you can buy foreclosed units for $40k-$50k a door, sometimes less. Single family homes are the best way to go. Their are a handful of communities where you can pick up existing inventory that will cash flow and offer a high chance of good appreciation. Single family homes give you the best exit strategy as well – much easier to sell a home than a duplex.

Foreclosures
Due to many investors being taken advantage of over the past few years, there are numerous foreclosure and really great deals in the multi-family market, specifically in duplex units. It is not uncommon to find fairly new duplexes in the $80k-$100k range that will reach rents around $1500/month (both sides). Many of these deals reflect double-digit CAP rates which are almost unheard of in the residential market.

There are also opportunities in “flipping” properties. The best deals are for those that have cash and a stomach to sit on something for several months. The properties that have the most potential for return on investment also require the most work and may take a few months to complete if you are working to adhere to a stricter budget. If you have the stomach for it, and the cash to put up, deals can be found with 30% or more cash on cash. I have personally assisted investors with deals that provided over 100% cash on cash in all cash transactions. Rehab loans are harder to come by in the investment arena. An owner-occupant (someone looking to live in the property) can look at FHA 203k programs (I have a great lender for this), but investors are finding it harder to get loans to rehab and hard money is so tight right now that when you can find a hard money lender willing to fund a project, the rates and points will eat away a large portion of your profits.

Overall “Short” Analysis (Summary)
If you need tax incentives, make sure you can cash flow. Properties in select areas can cash flow easily with 25-30% (most lenders requirement now) and the single family market is an easier exit strategy. Look for indicators of higher potential appreciation areas. If you are just looking for straight positive cash flow (passive income), and are not as concerned about the exit, look more at duplexes because now is the time to buy right.

Contact Me with any questions or to assist in putting together a more detailed investment strategy. I look forward to working with you.

While Go Zone accelerated depreciation is a great reason to buy real estate investments on the Mississippi Gulf Coast, it is not the only on. While every home buyer and investors needs are different, the one thing everyone wants to see is appreciation in their investment. Looking for emerging real estate markets is one of the key factors for investors who want to see their real estate investments grow in value.

The Mississippi Gulf Coast is a truly under-valued area in terms of real estate in general. Part of this is due to other states’ overall view of Mississippi in general, but we all aren’t toothless slobs that can’t enunciate – just the ones they show on the 6 o’clock news. The rest of us are at home with our families or working

Whether you believe it or not, the Mississippi Coast is a true emerging real estate market and more investors are realizing that now. If you want to be an early mover, contact me and let’s analyze your investment strategy.

So What Makes the Mississippi Coast so Special?

The MS Coast has numerous economic engines which include:

1. Federal Dollars. Keesler Air Force Base (Biloxi), Naval Construction Battalion (Gulfport), Camp Shelby Army Base (Wiggins), Stennis Space Center (Hancock County) and the Coast Guard station (Gulfport) which are all within about 40 miles of each other. Keesler Air Force Base is home to the Cyber Command Training Center as well as the Hurricane Hunters. These bases keep a steady flow of military personnel moving in and out of the area which helps to balance the housing market even when national housing statistics are very gloom.
2. Local Economic Influences. Most strong real estate markets have at least one driving force to the economy – the MS Coast has many. Not only does south Mississippi have the military installations, but it also happens to be a major gaming destination. Billions of dollars have come to the Coast through the gaming industry. A “Vegas on the Beach” if you will, major casinos in Biloxi, Gulfport, and Bay St Louis, with more planned in other areas such as D’Iberville (a truly growing area) as well. Other economic engines include seafood, ship building, tourism (beaches, islands, fishing) and a growing container port. Gulfport is expanding its already large container port to be one of the largest in the country and will be state of the art (see Port of the Future – outside link opens in new window).
3. Prices. The Gulf Coast of Mississippi is one of the most undervalued areas in the country as far as what you get for the money and what its potential is. With the exception of a surge immediately after hurricane Katrina that had to balance itself out, homes have shown very steady appreciation historically. Currently, new homes can be bought in the $120k+ range but inside subdivisions, I recommend going a step above to the $130k-$140k range. The initial cash on cash looks less appealing, but these subdivisions usually offer a much better exit and less chance of “going downhill”. There are many very nice subdivisions that offer smaller homes in this range that would appeal to investors, but most agents do not show the potential. For those comfortable with buying older homes and doing some upgrades, it is very feasible to see positive cash flow and equity almost immediately in 10+ year old homes. Want to take the development route? There are an abundance of quality properties to start on.
4. Tax Incentives. Tax incentives are a great reason to look at an area, but there is so much more to it. Many investors who bought under the first part of the Go Zone got took in by unscrupulous builders and real estate agents that sold properties at above (in my opinion) market value in order to reap the rewards from those sales. Go Zone is an awesome incentive – when you are talking to someone who wants your repeat business in the future and not just a fly-by-night company looking to make a buck. If you are considering taking advantage of Go Zone, time is drawing near. Don’t wait until “later” because you may lose out on your ability. Pickings are slim and the best properties go to early movers. I can help you get great deals if you contact me in enough time. Don’t let Go Zone be your only reason for investing here though – there are so many good reasons.
5. Location. Location, Location, Location, right? The Biloxi/Gulfport/D’Iberville/Ocean Springs areas are located on the beautiful Gulf Coast. If I didn’t have you before, let me say it again – waterfront communities! Everyone loves being near the water. Well, maybe not everyone, but a LOT of people do. We also happen to be approximately an hour from New Orleans, LA and Mobile, AL. Both of these cities can be identified as emerging markets on their own, but the MS Coast is better than either due to federal spending, diversified local economy, gaming, tourism, and the in-progress port expansion.
6. Growth Potential. The MS Coast is comprised of several cities including Bay St Louis, Pass Christian, Diamondhead, Long Beach, Gulfport, Biloxi, D’Iberville, St Martin/Ocean Springs, and other smaller areas surrounding. In many cases, there is no clear definition between these cities other than the corporate lines that divide them. This makes for a huge growth potential in these areas producing one large city base rather than several smaller communities. There is also plenty of room for expansion in the northern parts of these counties which has already started due to lower insurance rates north of the Interstate, however, the bulk of the population is in areas south of the Interstate with the exception of North Gulfport and the outstandingly fast growth in the D’Iberville area.
7. Quality of Life. As a “military brat” myself, I have lived in numerous place. I was born in Biloxi and moved back in 1999 to help my grandmother, who’s health was diminishing. I have found no where else that I really could say that I loved as much as here. There is always something going on, the people are great, the dining is just as good as the people, and when you simply don’t know what else to do – a simple walk on the beach or day on the water will put your mind at ease and really help you appreciate life.

This is my home, one of the best emerging markets in the country, and I enjoy it daily. An investment on the MS Coast is a great one indeed, provided you are talking to the right person. I look forward to discussing your needs with you and working on your portfolio. When you are ready to move here yourself, I look forward to relaxing with a fishing pole in hand, and enjoying what the Mississippi Coast has blessed us with.

Go Zone accelerated depreciation is in its final year without any anticipation of being extended again. This means that if you are serious about doing anything with Go Zone property – you need to start acting now.

There are a lot of agents out there that are selling properties, saying they qualify for Go Zone under a “developer’s option”, but from the tax professionals I have spoken with, this is very murky water. I have had one broker tell me that they have been able to make this work, but two tax attorneys said no way. My philosophy is that if you go by the book, you won’t be heartbroken later when some IRS auditor tells you that you tried to game the system and lost.

The inventory for truly qualifying Go Zone property is declining. There is almost no multi-family properties that qualify and there are few single family properties that really make sense from an investment analysis. When I look at any real estate investment, I feel that it is important to make sense before tax incentives – otherwise it is not really an incentive, it just becomes a tool to sell.

There are a handful of single family homes being built that will qualify and make good sense from an investment standpoint.  If multi-family (duplex, triplex, fourplex or more units) is what you are most interested in, I have builders ready to get you a top-quality product that will make sense financially AND you can get the Go Zone depreciation.

Contact me today for more information or if you are ready to get started.

The Go Zone offers 50% accelerated depreciation in the first year of acquiring an eligible property. While the ins and outs need to be discussed with your tax professional, I have been working with Go Zone since its inception and not only can I assist you with the information, but also the properties.

I take a little different approach than many agents. Many agents are pitching overpriced junk because it makes sense as an investment after the go zone depreciation is applied. I look for properties that are good investments before the depreciation. This makes the Go Zone icing on the cake instead of just a way for builders to make more money on their work.

It is no secret that waterfront properties are typically in higher demand and make more money as rentals. What if you could build waterfront developments, be in them for about the same cost as inland properties, and create a higher cash flow?

Some investors may shy away from this proposal because of the risk of waterfront properties in a hurricane area. If you do not feel comfortable with the fact that flood insurance should take care of this for you, I can assist with many other Go Zone viable properties as well.

Contact me today. Time is running out and it has been posted in good faith that there is no reason to expect Go Zone to be extended again beyond the end of this year.