Many people dream of buying their own property, but the process can be daunting for first-time investment property buyers. However, by keeping a few key things in mind, you can ensure your investment pays off in the long run. Want to learn more? Read on for essential advice on buying your first investment property and how to manage it below.
What to Consider
There is a lot to think about when buying rental property. Once you’ve figured out a budget and financial considerations, property management might be top of mind. Do you plan to manage the property, or will you hire someone? Mynd also suggests factoring in property management costs like homeowner association fees, property taxes, and time spent on maintaining and repairing the property. Another thing to consider is if you plan to rent out your property. The amount you can charge for rent will depend on location, home type, and home updates you’ve undertaken. Be sure to complete home improvements that will boost property value and appeal to potential renters.
To protect the value of your home, you should also consider getting a home warranty. However, you may consider if a warranty is actually worth the price. A home warranty can be beneficial by considering the costs involved if home systems or appliances break down. Before deciding on your purchase, look at your home inspection report for any red flags and double-check if there are any pre-existing warranties on appliances and their coverage.
Features of Profitable Properties
There is no one perfect answer regarding what makes a profitable property, as there are many variables to consider. However, certain features make a property more successful and profitable than others. Here are five essential features of beneficial properties:
- Location: Properties in prime areas tend to be more in demand and thus generate higher rental prices and occupancy rates. For example, in D.C., neighborhoods like Columbia Heights, Takoma Park, and Petworth are in higher demand.
- Size and layout: Another important consideration is the size and design of the property. According to OpenDoor, larger units or properties with unique layouts are often more desirable and command higher prices.
- Amenities: Properties that offer desirable amenities such as a swimming pool, fitness center, or concierge service are often more profitable than those without.
- Condition: Well-maintained properties that are in good condition will always have a higher market value than those that look shabby or run down.
Deal with Professionals
When it comes to buying your first property, there will likely be a lot of questions you may have. You will also be navigating a reasonably complicated process, so it’s best to set yourself up for success by dealing with professionals. Following are some professionals who can support you through the process:
- Solicitor: A good solicitor can help you with the legal aspects of purchasing a property. They will also be able to give you advice on the best way to protect your investment.
- Mortgage broker: They will be able to help you find the best mortgage for your situation. They will also be able to give you advice on the best way to structure your mortgage.
- Realtor: If you need help finding potential properties in different neighborhoods, working with a realtor is the best way to proceed.
These tips will help you quickly find and purchase your first investment property. Be sure to set yourself up with essential tools for success, such as a home warranty, realtor, and even property management services. Have fun with this new investment journey, and good luck!
Image from Unsplash