It’s no secret that priorities have shifted and values have evolved for property owners and tenants alike. With more renters entering the market, real estate is hot for investors. If you’re already an investor or want to get into the field, now is a good time because people are relocating, downsizing, or looking for a place with more space. Are you thinking about buying a property to rent out? If so, here are five things you should look out for when you’re purchasing.

Neighborhood

One of the most important things to keep in mind when you’re buying a rental property is the neighborhood around it. What’s the surrounding area like? What kind of people will it attract? Who will be likely to live here? Even if the property is large, immaculate, and modern, if it is in a bad neighborhood you will narrow down your rental options and decrease the price. Another thing to think about is how the neighborhood will change. If it is just okay now but things seem to be moving, the investment may pay off in a few years when the property is worth a lot more. Don’t just think about how the neighborhood is now, look out for how it will change in the future.

Location

Beyond the neighborhood, look into what’s close to the property. Is it near some hot spots that are attractive to people? What kind of people will be around day-to-day? If it’s near a train track or a sports arena, this can be seen as negative to some renters. But being right next to a mall, shopping centers, and transportation can be a huge plus. It doesn’t matter what city or state you’re in, if the property is near some enticing locations you just may have a hit on your hands when it comes to renting the property out. With real estate markets being so singular, fluctuating by neighborhood and even street, what’s around the property certainly matters.

Schools

Another thing you should look for when you’re buying a property is the quality of nearby schools. Are there good elementary and high schools for families? Is it a college town? Buying an apartment near a college is often a good investment because you will always have students who want to live there. What amenities are around for those students? For example, a gym, coffee shop, retails stores, job opportunities, etc. When it comes to buying a rental property, being near good schools, especially colleges, is a huge plus. Lockers for college are now popular because so many students buy things they need online. When it comes to buying a rental property, being near good schools, especially colleges, is a huge plus.

The Neighbors

When you’re looking to buy an apartment or a house, you should look into who the neighbors are. Meet them before you pull the trigger and buy the property. If you know the neighbors, you will have the upper hand when it comes to renting it out. You will not only know what to tell the renters, but you will also know what not to tell them. Bad neighborhoods can really affect the success of your rental. They can even impact what you can get for a monthly rental. Use your intuition and get to know the neighborhoods. If you think that they might be a problem, reconsider whether or not you want to buy the property.

Renovations

Finally, you should look into what you will have to fix up. As a landlord, you will need to repair anything that breaks for your tenants. If the place needs a lot of fixing up, you should consider how much this will cost versus the monthly rental and the overall cost of the property. Even if the place needs some major repairs, it can still be worth it to invest in the property, fix it up, rent it out, and sell it later for a profit.

When you’re thinking about purchasing a rental property, there are a lot of moving parts. If you stay on the lookout for these five things and keep them in mind, you will know what you are in for, what you can make on the rental, and if you will be able to profit when you choose to sell. Now is a good time to get into real estate if you have money to invest. 

 

Categories | Article | Fundamentals
  • Contributor

    We believe in the positive, life-changing impact of real estate investing. Our mission is to help investors achieve their goals to build wealth, better manage time, and live a life full of purpose.

Related Posts

0 Comments

Submit a Comment