There’s no static real estate strategy that you can use year after year. If you want to make money in real estate, you have to draw your own strategy to stay ahead of your competitors and grab the benefits from ongoing trends.
We’re here going to propose one smart and strong strategy that has the potential to a significant role in 2016’s real estate market. In fact, you don’t need more than one plan to work on if the plan is solid and perfect.

Rehab and Flip Houses: Investing In Secondary Cities

There’s one real estate investing strategy that continuously making profits and outshining the rest – rehabbing and flipping houses, according to a recent report published on RealtyTrac. In the U.S., 5.5% share of homes was flipped in 2015, while it was 5.3% in 2014. The rise in the share of flipped homes last year was the first increase after continuously being dropped for four consecutive years.
A recent report on Fortune Builders shows that spring selling season is going strong and the flipped home share is probably going to transcend last year’s numbers. So, flipping homes is going to earn you a lump sum of money if you can plan a solid strategy.

Target the Secondary Cities

The inventories in the big cities will certainly be tight and the investment options won’t be quite affordable. So, instead of going after the prominent 24-hour cities such as San Diego, San Francisco, and New York, focus on the 18-hour second-tier cities such as Houston, Austin, or Milwaukee.
The big cities have larger price points and the profits will be bigger if you can make it but greater risks are associated with them as the competition is quite fierce and the markets are already saturated with investor activity. Instead, look for alternative perspective.
The recent success of Houston and Austin real estate markets has made it clear that secondary cities across the country hold real potential to boom in 2016. It can also be predicted that smaller markets will continue to be more attractive than some of the bigger cities. In fact, investing in secondary cities could likely be the most popular real estate investment strategy of 2016.

Investing in Puerto Peñasco

If you can extend your views a bit further, consider Mexico, our neighboring country, a really good option for such investments. Some Mexican cities, especially Puerto Peñasco, located only 100-km from the border with the U.S. state of Arizona, is a hotspot for flipping houses. The prices of the houses are relatively lower than the U.S. markets and the city is already familiar to American retirees and second homebuyers. So, you can generate lump sum of cash profits if you buy homes in Puerto Peñasco, renovate them, and flip to other homebuyers or investors.
If you determine executing this strategy, adopt ‘buy and hold investment properties’ as your exit strategy. Rehab and flip the properties when prices drop but hold and rent them when prices are high. In this way, you can capitalize on current high rents before selling in future.