Things to Consider before Buying Rental Property
From when you decide to invest in real estate to when you make an actual purchase of your first rental property, there is much work that needs to be done. If you are a first-time investor, this can be quite a daunting task.
Before making the first step, it is always important that you do a search. The idea of using the services of a real estate agent to assist in making the purchase seems practical, but it is advisable that you do the search on your own. Involving an agent can bring about the pressure that is unnecessary to buy before you have found a property that suits you. It is most advisable that you take an unbiased approach to all the properties and neighborhoods that are within your range of investment.
Top things to consider before selecting the most appropriate property
Often, property taxes are not standard across the board, and this means that as an investor planning to generate income from rent, think of how much you will lose to the taxes. Property taxes that are high are not bad as long as the neighborhood is in a perfect place that allows long-term tenants. It is not a must that the two go hand in hand. You can get the tax information from the town assessment office.
The neighborhood quality influences the type of tenants you will attract and how often you will be facing vacancies. For instance, if you buy a property near a college, most of your tenants will be students and the vacancies will be on a relatively regular basis, when the students go for their holidays. Remember this when looking to buy or sell American Real Estate.
No one wants to reside in a neighborhood that is frequent with crimes. Get access to accurate crime statistics for various regions from the police or the public library. Soliciting this information from the homeowner selling the property may mislead you. Look for issues like vandalism rates, pretty crimes, serious crimes, and recent activity regarding growth or slow down.
Check the neighborhood for current or projected malls, parks, gyms, public transport, movie theaters and other things that are likely to attract the tenants. There is lots of promotional literature in particular cities that will assist you getting an idea of where you can get the best blend of public amenities and rental investment properties.
Since rental income will be your source of daily living, you need to know the average rent in the area. If the average rental charges are not enough to cover the mortgage payments, the taxes or any other expenses, then you need to rule out this area. Look for a place that you can clearly gauge of the outcome in the next five years.