Successful investors know that it is best to allocate investments across several asset classes whose returns are not completely correlated with each other. Most of them have assets in cash, equities, bonds and real estate. Real estate is frequently under-represented in investor’s portfolios, but real estate adds an important element of stability in an investor’s returns.
Real state has been under-represented because good property investment vehicles have not been easily available. For many investors, their home has been their main real estate investment. Many large fortunes in real estate have been amassed by buying and holding properties to generate significant returns through cash flow and appreciation, and by taking advantage of their tax benefits, notably depreciation, long-term capital gains tax treatment, and the ability to defer tax liabilities through the use of 1031 tax-deferred exchanges. Buying and holding properties offers some of the very highest returns, stability and tax advantages available.
Bluefields Capital’s objective is to provide investors with a real restate investment alternative for buying and holding cash flow properties with superior returns and low volatility with all of the tax benefits of direct real estate ownership. Our investment houses all share the following fundamentals.
- Cash Flow
- Equity build-up
- Built in equity
Most homeowners are familiar with equity build-up, which is driven by the appreciation of a home and paying down a mortgage balance over time. Equity build-up increases one’s net worth in real estate assets.
Cash flow relates to deriving rental income in excess of all of the cash obligations and cost incurred, including the servicing of mortgage debt. To the extent that costs can be reduced and rents appreciate, cash flow will grow over time.
The best and most stable investment models combine both equity build-up and cash flow. For each property Bluefields offers for sale the pre-tax gains from cash flow and equity build-up are added together and projected out over a 5 year period under a set of modest assumptions about property, rent and expense appreciation.
Bluefields Capital offers buy and hold investment opportunities that combine cash flow and equity build-up. We are not counting the built in equity or possibility of appreciation. Our projected returns are very conservative.
Bluefields takes back properties, renovates and sells single family residential properties in and around Atlanta, Georgia. We then screen and put tenants in place.
Most importantly, we provide high cash flow properties, meaning that after putting down twenty percent on a property, the investor will realize positive cash flow, even after expenses related to vacancy, repairs and maintenance, property management fees, taxes, insurance, and mortgage payments. It is important for investors to choose structurally and cosmetically sound properties, obtain excellent tenants, and use a professional property manager.
Bluefields takes pride in the standard to which we renovate properties. We have specific criteria that properties must meet before we will offer them to investors. Well maintained
properties are extremely desirable and command higher rents and better tenants. They also minimize deferred maintenance costs in the early years after acquisition. Careful screening of tenants helps reduce the amount of damage caused by tenants.
Bluefields' properties provide excellent cash flow and are not reliant on appreciation to deliver exceptional returns.
