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How do I select my rental property? This is a question that most first-time landlords ask. True, becoming a landlord sounds like a profitable business. A lot of people who enter the industry even with little knowledge or experience succeed over time.
Before you purchase any property, first, you must be able to identify if it’s worth your while. Today, Landlord Prep will share five tips and considerations when choosing a great investment property.
First, you should have a list of the qualities you want in a rental property. Do you want your rental to be located near local schools? Would you like a single-family home or duplex property? Thinking about your ideal investment property is a good starting point. But remember: no rental property will be perfect.
For you to choose the best rental property, envision the kind of tenants you want. If, for example, you want to target young professionals, get a property that suits their character. Doing this will make it easier for you to market the property and reduce vacancies.
Since you want to make money from rent, you want to know how much income you’re going to generate. Get information about property taxes. Consider the possibility of property tax hikes in the near future. You don’t want to invest in a location that’s in financial distress. Also, tally your expenses -- maintenance costs (depending on the area), physical investments (roofing, HVAC, foundation).
Related: 9 Ways to Maximize Revenue from Your Rental Property
No landlord wants his tenants to feel unsafe and be in danger because the rental is in a place that has serious crimes. Profitable rental properties are properties in good neighborhoods. Do your online research and ask the local police about crime statistics. Pay attention to risks of burglary, theft, etc.
If you expressed interest in a rental property that’s already occupied, be careful. Perhaps the previous property owner welcomed tenants who may not meet your expectations. Make sure to collect information on the inherited tenants. Are they likely to go against your rules? Landlords may have to consider an eviction for tenants who choose not to conform to their new requirements.
Related: Inherited Tenants and How to Deal With Them
So you see, buying an investment property to rent shouldn’t be difficult at all. With a good rental property investment strategy in place, you’re sure to find one that meets your budget and attracts your target renters.
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