Tips for Choosing an Investment Property

By chrisrath • November 3rd, 2010

Hiring a property manager is essential to your success as an investment property owner. Allowing a property manager to screen tenants, collect rent, and survey the property will save you a ton of time and money, giving you the space you need to find new properties and grow your business. Even still, there are several things you’ll need to keep in mind as you look for investment properties.

investment property

Consider the Location

The location of your investment property is crucial. Are you hoping to rent your home throughout the entire year or do you want a place you can rent out seasonally?  Buying a home near the beach may seem like a great idea because you can charge a higher rate for short-term rentals during the summer months. The problem is that you’ll have extra expenses associated with boarding the property for the winter. The cost of flood insurance, a mandatory expense, is also something you’ll need to consider. A home a bit further inland will give you greater potential, may cost less in upkeep, and will experience a lower tenant turnover rate.

Calculate Your Regular Expenses

Take the expenses associated with the upkeep of the investment property into consideration as well. We as property managers can regularly survey your property but you as the owner will have to make the final decision to make repairs. While your tenant will likely pay for utilities, you’ll still need to worry about landscaping, potential roof replacement, and the cost to repaint and replace the carpet in between tenants. Will the amount you charge in rent cover the cost of your mortgage, the cost of yearly expenses, and still leave you with a profit?

Remodeling the Property

Does the property you are considering need a bit of remodeling? Remodeling Delaware homes can be fun and can significantly increase the value of your property. Consider remodeling the kitchen or bathroom, adding new cabinets or appliances, to make the property more appealing. Remodeling is a one-time investment and should enable you to charge a bit more for the property rental on a month-to-month basis.

Choosing the right investment property can be tough but knowing the area and your financial limitations will make finding the perfect location that much easier. We’ll help you take care of the rest!

About the author

chrisrath I enjoy helping people find that right home whenever faced with a relocation situation due to their job or even a major life event. Since I have access to a large inventory of homes for sale and also manage many properties in the northern Delaware region, it is easy for us to help anyone make a smooth transition into this area. I am a licensed Real Estate Agent and also manage my own company Rath Management where we locate, screen, secure, counsel, and communicate with the tenant and the investor throughout the entire leasing process to keep homes filled. Our company also manages maintenance issues, collects and forwards rent monies, and even helps with the dreaded eviction process in the event a tenant does not keep up with the terms. Chris Rath

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