Buying Rental Properties Some Tips

Buying Rental Properties Some Tips

Buying Rental Properties - Some Tips
Buying rental properties can be a​ great way to​ build your wealth .​
However, as​ in​ most real estate investment, it​ is​ sometimes difficult to​ know if​ you've found a​ good deal - especially the first time .​
Here are some things to​ look for to​ be sure that rental is​ a​ great investment.

1 .​
Location .​
If traffic is​ heavier, rentals are easier to​ rent .​
a​ sign will often pull more response than an​ ad in​ the paper .​
If it​ is​ a​ nice locale, it​ will usually rent faster .​
This is​ also true of​ places close to​ amenities.

2 .​
Numbers .​
Run the numbers .​
Get every last expense figured into your calculations, and be sure that you will have positive cash flow from the start .​

3 .​
High home prices .​
Look in​ towns with high home prices, as​ this creates rental demand .​
What do people do when they can't afford to​ buy? They rent.

4 .​
Low maintenance buildings .​
Avoid cedar-shake roofs, and wood-sided buildings .​
Look beyond current expenses to​ how much maintenance the building will need .​
Low maintenance means less headaches and more profits.

5 .​
Good rental history .​
Ask to​ see the rental history .​
Note how long residents are staying on average, and how well they pay on time.

6 .​
Below market rents .​
Buying rental properties with below-market rents means you get to​ raise rents .​
Raising rents means you imediately raise the value, because rental property values are based on income.

7 .​
Complies with zoning and fire codes .​
Have it​ inspected, and ask local officials if​ there are any problems .​

8 .​
Less than 20 years old .​
This is​ somewhat arbitrary, but if​ you limit your search to​ newer buildings, you will be less likely to​ have building code and maintenance problems.

9.Owner/manager that is​ out of​ state .​
These properties are often the best deals, because it​ is​ tough to​ manage a​ property from far away .​
An out of​ state seller is​ often more concerned with a​ quick sale than a​ high price.

10 .​
Neighborhood is​ stable or​ improving .​
Stable is​ okay, but if​ you can buy in​ a​ neighborhood that is​ improving, you'll rent the units more easily, and therefore get automatic appreciation in​ value with time.

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