Factors to Consider Before Investing in Rental Homes
Investing in real estate especially in rental homes is one of the best financial decisions one can make.
Being such a major investment, you should not rely entirely on your judgment alone.
However, seeking the help of a Real Estate Agent can put you under pressure to buy a property that does not really suit you when you want to search some more.
You will need to have an unbiased approach towards any property and neighborhood that is within the range of your budget.
So the help of a Real Estate Buyer’s Agent can be of significant help with choosing the right piece of real estate to invest in.
Or you may have a Real Estate Agent you know to be reliable and honest they too can be of assistance.
Below are some of the main factors you will need to consider in your research for a rental property:
The location of the property determines the quality of the neighborhood, which determines the types of tenants to expect as well as how often you should expect vacancy rates. For instance, a property located near a university will attract tenants who are students and there will be regular vacancies during vacations and end of study period.
Some of your tenants may be families with school-going children. If these are the type of tenants you want, you need to look for a place that is near a decent school. This means you will have to check the quality of the nearby school, because it will have a bearing on the value of the investment, as well as the length of time tenants live in the property. Families with school-going children are generally long-term tenants and are the great for your rental homes.
You need to find out from the local council all of the councils rates and fees as well as water rates this information is freely available to the public upon request. You should also speak to other homeowners within that community to learn more about the area E.G. is it a high crime area or is it noisy in the evenings, which is no good if you have children or are elderly living on your own. High rates normally go hand in hand with an excellent neighborhood and long-term tenants, but this does not always happen. This may affect the value of your investment.
Do your research on accurate crime statistics of the neighborhoods that you target. You can get all the information you need from the police or the public library. Vandalism rates, petty crimes, serious crimes, as well as recent activity (in terms of growth) are items to look for. Most Real Estate Agents can also assist you with this as well to a small degree.