The number one thing you need to consider when buying an investment property is the property condition. I recommend a very thorough inspection be done prior to the purchase so that you can properly assess the necessary repairs and upgrades and figure them into your total calculations. Too many investors underestimate the repair costs and deferred maintenance costs related to their investments. Your resale value, rent value, and tenant retention is wholly based on this. Assuming you are hiring professional property management for your property, you will be able to properly summarize for them the condition in which you bought it, any repairs made and upgrades that you may be offering. This helps in being able to attract a good tenant and in managing your maintenance requests. With proper documentation, you will be able to decipher tenant-caused maintenance issues versus what is your responsibility and preserve your cash flow.
When looking to purchase an investment property, the most crucial component is your team. You’ll need a real estate professional who is both knowledgeable and experienced with investment properties as this buying process is very different from shopping for a primary home. Your agent can recommend or provide, at a minimum, a specialized real estate attorney, insurance agent, home inspector, appraiser, and CPA (or financial advisor). Real estate investors are only as good as the professionals in their corner. This team, especially your agent, is critical because in order to truly find what will be a profitable investment property, you need a well thought out and researched plan. This plan will include things such as property type, financial goals, budget, location, vacancy rates, local laws and regulations, and insurance. Once the above planning is done in a detailed way, you’re more assured that your investment property won’t become a money pit.
I RECOMMEND A VERY THOROUGH INSPECTION BE DONE PRIOR TO THE PURCHASE.
REAL ESTATE INVESTORS ARE ONLY AS GOOD AS THE PROFESSIONALS IN THEIR CORNER.
Kelly Stumphauzer Prosper Investments Cleveland, OH Connect with Kelly
Kathie Whitehouse HWWB, Realtors® Birmingham, MI Connect with Kathie
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