Before you invest in a property, there are four qualities you should check for first.
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Not all properties are equal when it comes to real estate investing. If you want to be more successful with your investments, there are four key qualities you must look for when considering a property:
1. The projected income. Any property you invest in should bring a high return. Following the 1% rule is a great way to ensure this. Basically, if you buy a property for $400,000, you should charge $4,000 each month in rent. In some parts of the company where properties are less expensive, but rental rates are higher, you may want to charge 2% of the purchase price, instead.
2. The current tenant situation. If there are already tenants living in the property, you need to proceed with caution. The last thing you want is to buy a property on a whim and wind up in a nightmarish scenario.
Any property you invest in should bring a high return.
3. The overall condition. It’s impossible to find the perfect property, but you should try to find one that is generally in good shape. If you do plan to buy a property in less-than-ideal condition, you need to be prepared to shell out the necessary funds to fix it up.
4. The utilities. If you purchase a multi-family property, you need to determine whether the utilities are separate for each unit or if they’re lumped into one. If the systems are separate, you’re in the clear. If they aren’t, you’ll either have to pay to separate them or foot the bill for the entire building each month.
If you have any other questions or would like more information, feel free to give us a call or send us an email. We look forward to hearing from you soon.