Are you thinking about investing in real estate? It may be the perfect time to purchase a rental property, a vacation home, or to flip houses. We would love to help you find the perfect investment property. Here is a list of tips to help you get the best return on your investment:
First, consider what type of investment property is best for you and your family.
If you are thinking about a rental property, such as a vacation condo or rental home, consider how much time will be needed for things like maintenance, managing listings, and vetting potential tenants. For rental homes, make sure the areas you are searching are attractive to tenants in terms of proximity to nearby business centers and transportation hubs. School district could be another consideration.
Is a vacation property more to your liking? Make sure you read any and all rules pertaining to owners and guests, as well as rules on renting your property out when you are not using it, if that is something you plan to do. Many areas where you may want to have a vacation home with have HOA rules that will be important to know. Some areas do not allow short term rentals at all, so be sure to make sure that it isn’t against local municipality rules! Also be sure that your vacation property is somewhere you imagine your family wanting to travel to often enough to make it worthwhile.
For new house flippers, you’ll want to find out what return you can expect to get in your market area. Talk to contractors and suppliers to get realistic estimates on renovations, both in terms of price and time to completion.
Here are some additional Do’s and Don’ts for investing in real estate:
Do aim for at least a 15% return on investment.
Do look for homes priced in the low end of the median price range.
Do look for 3-bedroom, 2-bath single family homes for rentals or flipping.
Do focus on one neighborhood or area.
Do purchase rental properties close to your home if you plan to manage them yourself.
Do use a real estate agent to help with all your buying and selling needs.
Don’t purchase a second property until the first is earning revenue.
Don’t buy properties that you wouldn’t want to manage, even if you plan to use a property manager.
Don’t buy a home that you cannot afford to carry for several months in case of a slow market.
Don’t buy a home or condo without having inspections performed.
Don’t buy without title insurance.
Don’t buy more properties than you are able to manage.
As we mentioned earlier, we can help you search for investment properties. We can also help connect you with property management if you don’t want to manage them yourself. Sometimes buyers make the mistake of searching on their own, and contacting the sellers or listing agents directly. Working with several different people is not time efficient and makes it more likely to miss out on a deal. By working with an agent, you allow them to learn your tastes, needs, and parameters, so they can find the best property for you, with the least amount of stress.