In today’s time, you’ll be surprised how many properties are being offered at a low price. If you’ve been considering to invest in rental property, then this is the best time to do it. The thing is, how you are going to pick a rental property that is perfectly suited for your needs?
As you read the next lines, you will be able to find out questions that will help you to evaluate rental investment property.
Question number 1. What’s the location – when buying real estate, the location will always have a big factor in it. And whether you like it or not, the overall value of the house will be determined by the location it has. You on the other hand have to be mindful of the maturity of the neighborhood and a good range here would be 10 to 35 years.
Properties are likely to be in excellent condition by performing regular maintenance. Then again, for neighborhoods that are over 35 years, it normally has run down houses which makes it more challenging to be picked by renters and have high upkeep. But this doesn’t indicate that you can’t strike a good deal because there are these hidden gems if you’d be thorough in your search.
Question number 2. Does the property has acceptable condition – all investment property is going to require maintenance and repair and this takes place before putting it on the market and while it’s being rented. The best deals usually demand the most work.
Always bear in mind that aside from doing the initial repairs and the renovation to turn it into an appealing property among renters, you will also be doing constant repairs and maintenance. As a rule of thumb, older homes have higher maintenance cost.
Question number 3. What’s the price you’re willing to pay and how much it’s worth – as for the property in question, is it below the market price, what is the ratio of price to size, will you be able to sell it on the time you want it to sell? When making a purchase, it is never wise to take these things for granted.
Question number 4. How much income it can bring you – in this regard, it is important to research about the profit that the property can do for you for its rental. Not only that, check as well if the rent would be enough to cover expenses and still have room for profitability and factor other expenses too such as insurance, mortgage, vacancy for 90 days and maintenance.