Owning rental property can be a lucrative endeavor that allows you to earn passive income each and every month. But it can also be a way to lose money – not just on the investment itself, but also through repairs and tenant damages if you’re not careful. With that in mind, there are some key tips to consider before moving forward with any type of rental real estate investment.
Buy in the Right Location
It has often been said that when it comes to real estate, the three most important words are, “Location, location, location.” This doesn’t just hold true when buying a primary residence, but also when considering an investment property.
The two areas may not be one in the same, though. For instance, when purchasing a property to rent, you want to be sure that it appeals to a wide range of potential tenants. Oftentimes, this can mean buying in working class areas, and / or highly desirable vacation spots – depending on what your overall goals are.
Purchase at the Right Price
Buying a property at the right price can help you to better withstand any ups and downs in a property’s value over time. In order to ensure that you are on the right track here, it is essential that you know what properties are selling for in your desired area – in turn, allowing you to understand what is considered a good value and what is not.
Be Mindful of Any Potential Safety Issues
When purchasing property through the eyes of an investor, knowing about any potential safety related issues is a must. In this case, be sure that you are aware of items such as obstructed exits and / or doorways, as well as cracks or unevenness in the sidewalk and / or driveway. Not only could these types of issues require expensive maintenance, but they could also lead to legal liability if they are not corrected and a tenant becomes injured (or worse) because of them.
Know How Much Time Property Management Takes
Depending on how many properties or units you own, managing the real estate, as well as the tenants, can be extremely time consuming. The good news is that if you don’t have the required time available, an experienced property management company can step in. For more details on the duties that you can hand over to a property manager, as well as other benefits of working in conjunction with one, contact us today.