However, the prices have gone up significantly and the days of 15-20% return may be gone but opportunity is always available in real estate. Without spending a large amount of money on repair and fix up you can expect to get closer to 6-8% return on your investment.
This is if you are paying all cash. The way to leverage your return is to finance the property you own. You can eventually eliminate any cash investment you have made in the property and your return will then become infinite. Consider an example. You buy a home for $100,000 and you put 20% down and have an $80,000 mortgage. Your investment is $20,000 and you have a loan for $80,000. Your rent is $12000 a year. Now your return on your money is significantly higher. You are now looking at over a 50% return on your money. This is very simple to do and you can do it very easily with 20% down.
Hold the property for 4 years and it may then be worth $125,000. You can now refinance the property with an 80% loan to value ratio and get a $100,000 loan. This will allow you to take back the $20,000 cash you originally invested as your down payment. Now you technically have no money invested into the property. You have recovered your down payment and still own the property that is receiving a minimum of $12,000 a year in income.
How do you calculate the return on a property in which you have no money invested? You really can't because you can not us 0 in your equation. This is one of the best and fastest ways to build wealth through real estate. There are many people who would say cash is the best way to invest but if you want to make a better return on your money you have to use leverage.
Visit Income Property Las Vegas at http://www.incomepropertylasvegas.com