Taking an Out-of-state Leap to Las Vegas

[Molly Ogunnowo]

Hello,

I am relatively new to real estate investing. I just rented out my first house after downsizing to a condo. I am now ready for my second property and I have seen a potential in the 89183 zip code of Las Vegas, NV. I will be using Seller Financing option for this property and the property is still on the market going for $376900 with original interest rate around 5%. It is a new construction (2022) and current owner has only lived in it for a year but has to move because of work. I am seeking advise, suggestion and guidance if this zip code is a good buy for rental purposes, that is, will it give me a positive cash flow? I know Las Vegas is making a come-back (to pre-COVID) in tourism however, with the current interest rate, I am concerned that I may not be able to have positive cash flow on the property. What are your thoughts, suggestion, opinions and concerns. Thank you for reading.

Molly O.

[Bradley Buxton]

@Molly Ogunnowo

Hi Molly, Seller financing can be a good option to get a short term interest rate.  Most people will not let the loan go more than 5-10 years before a balloon payment. Make sure the term of the loan are clear and it might be worth hiring an attorney.  In Reno we have seen some seller financing as interest rates are dropping it might be better to ask for a seller credit to buy down the points on the loan.  You'll have to calc this out and a good loan officer can help.  

To determine cash flow there are a few rent calculators from Zillow, RentCast, BP.  This will give you an idea of rents in the area. Are properties sitting for a month before being rented?
Vegas can have some ups and downs and unlimited building can hurt long term values.

A good Investment Real Estate Agent can help with the market and equity values in the area. For our clients in Reno Tahoe we do all the cash flow and other metric calculations and build in expenses to our reports. We analyze the entire market to find deals. I'm happy to be a resource if you want to connect.