What to Look for in a Rental Property?

Figure Out Your Investment Costs & Budget

As property values hit an all-time high, the appeal of investing in rental property has increased drastically across the country. However, like other investment opportunities, you need to be prepared for the possibility that it might take some time before it pays off. Rental properties have more demand and require more upkeep which can be overwhelming if you are not prepared for these costs. Make sure you have enough money to cover required insurance, mortgage payments, and upkeep between renters. Property managers are trained to assess your financial situation to determine if you have sufficient liquid assets to cover expenses for the first twelve months in case of an emergency.

Turnkey or Fixer-Upper

Whether learning from the internet or watching TV, buying a fixer-upper is never as easy as it looks. While this is usually a cost-effective solution, it comes with a fair share of risks, especially if you aren’t familiar with construction costs and timelines. These rental properties have lower prices than turnkey ones, but that doesn’t mean they are cheaper. Potential investors should account for the cost of home improvement projects and the extra costs that pop up when you tear down walls. Whether you are going for a fixer-upper or a turnkey property, ensure a thorough inspection is conducted to ensure any issue is discovered and addressed. For those with experience flipping houses, fixer-uppers are a viable option. First-time property owners should start with turnkey property to avoid the stress and inconveniences of renovation.

Location

Once you’ve established a budget and know the type of house you want, it’s time to scout for the ideal neighborhood to invest in. We believe that location is crucial and determines the type of tenants you get. If you buy renal property near an institution or university, chances are you’ll attract students or young professionals. Most investors prefer B-Class neighborhoods with a mix of homeowners and renters. "Up and coming" locations are ideal for first-time investors, as these areas will likely rise in value over time.

Check the Amenities in and Around the Property.

Renters are always looking for neighborhoods close to their desired amenities, such as parks, schools, shopping centers, and transportation. Other attractions that can help you attract tenants are services like healthcare, theaters, restaurants, and gyms. Available amenities in any given area help create a lifestyle portfolio and tell a story for the neighborhood. You can use this to your advantage when creating marketing material to attract tenants.

Contact us today at 3 Options Realty and access the tools to help you make more informed decisions and attain the bottom line, profits. Please schedule an appointment with our property management experts to kick start your rental ownership journey on the right foot.