Investing in rental properties is no small commitment, and at Americas Housing Alliance, we want to make it as easy on you as possible. Especially for clients looking at turnkey real estate investing for the first time, there are a few important areas to keep track of.
Knowing the right areas to investigate and research in advance can save you tons of time and potentially money. Here are a few tips for keeping your first investment in rental properties low-stress and profitable.
A detailed understanding of your costs and expenses is vital, as is a handle on your own finances. Many rental properties will involve a mortgage loan, and you need to know what you can qualify for and what sort of rates you can get.
You’ll also want to get a firm idea of what sort of maintenance, repairs and other general property costs will be. These need to be factored into your calculations, not considered separately. Save room for a down payment if you need a mortgage, as well.
Another area to research in advance is rent considerations – how much you can charge, and how you can attract tenants in that range. Speak to property managers in single family homes, and check online or in the classifieds for similarly-valued homes and their rent prices. If you see incentives like free months being offered by the current owner, this could be a sign that a property is struggling.
It’s great to get the right bits of advice and tutorials from proper sources, but there will be elements of this process you have to research on your own. Due diligence in elements like location, the economy and individual financial factors are vital to your success, and while a guide can point you in the right direction, you have to follow through.
In general, you’re never looking to buy at retail market value. You need to leave the closing table with equity, either for future profits or a cushion for selling before your planned liquidation rate. Make sure you’re using the most reputable valuation checks, and not leaving any of those elements to chance. With the right patience and a keen eye, you can find great discounts on market value for amazing properties.
Want to learn more about first-time investing, or any of our other investment rental property services? The brokers at Americas Housing Alliance are standing by.