Purchasing investment property continues to remain the most popular way to increase wealth and secure future assets for the past couple of years in the United States. Mostly it is because of the availability of the discounted foreclosures and undervalued lands that turn into profitable rental property rather quickly.
Although the ongoing trend seems profitable at first glance, but investors cannot earn benefits simply by taking things for granted. Here are 10 points shared by National Realty Investment Advisors that investors should consider to ensure they earn a profit when buying an investment property.
- Choose the Right Location: Before you choose a location, it is of utmost importance that you consider the development prospect of the area. Other factors to consider here is crime record of the area, availability and nearness of public facilities and utilities.
- Study the Local Market Dynamics: It is important to get well familiar with the local realty market. Learn the variation in property prices by street. Don’t shy away from asking a few realty investment agents questions to get better insight on the matter.
- Choose the Right Property: Getting the right property right away is quite unlikely. First, you need to be clear on why you want to buy an investment property. After that, you will be able to make right decision based on factors like remoteness or accessibility of the property.
- Do the Math Properly: Get a precise idea on the value of assets you have available. If you are investing in rental property, make sure you can easily cover the mortgage payment through rents. Additionally, get a clear idea on the appraisal value of the property beforehand.
- Consider Additional Expenses: When purchasing an investment property, it is not only the selling price that investors need to consider. There are various additional expenses such as property tax, home owner’s insurance, repair & maintenance that must be considered.
- Inspect the Property: To ensure that you are getting everything you are paying for, a thorough inspection of the property is essential. Besides ensuring that you are not overpaying, a rigorous property inspection also gives you a good estimation on what the additional expenses might be.
- Pick the Right Financing Option: While interests on investment property loans are tax free, some borrowing costs aren’t immediately tax deductible. Knowing that, and structuring your financing in accordance is crucial. Don’t hesitate to ask for help from a financial advisor.
- Invest through Equity: One of the best ways to purchase an investment property is to leverage the equity of another property (including your primary home). This is a preferable way among regular investors, especially due to added tax deduction advantages.
- Make Property Attractive to Tenants: One of the biggest headaches property owners have is searching for a tenant. Keeping your property neutral and well-furnished is a good way to start with. Also, Hire a property manager if you want to save yourself some legwork in tenant search.
- Find a Reliable Property Manager: To prevent the overhead of being a landlord, hiring a professional property manager is a viable option. Property manager will take care of property maintenance, repairs, tenant search and rent collection.
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Additionally, in case you are in search of a reliable and best property investment advisor , research National Realty Investment Advisors, LLC. The best thing about investing with NRIA is that you won’t have to be worried about all the concerns mentioned above, since NRIA has covered them all in its unique and well-thought-out investment plan. Learn more on our official website nria.net