How To Buy A Profitable Investment Property

How To Buy A Profitable Investment Property ... It’s not a stretch to say that wanting to buy a profitable investment property is the goal of real estate investors. Do you know what you can do to ensure that you find those profitable properties? Here are some tips.

It’s not a stretch to say that wanting to buy a profitable investment property is the goal of real estate investors. Do you know what you can do to ensure that you find those profitable properties? Here are some tips.

Here is a common sense tip. Buy low.

Paying above market price for a property makes absolutely no sense when looking for investment properties. Especially if they will need updates or work done to them to make them either rentable or resalable.

Even properties in good shape should be purchased at a lower price. Keeping your expenses low is important to profitability. A higher priced property will mean higher mortgage payments. If they are so high that you can’t set rents high enough (because the local market won’t support it) to offset it, you’ll be in the red before you even start.

Another tip is to be sure to buy properties that don’t need a lot of repairs or replacements.

Again, this keeps expenses down. Typically, if a home shows with obvious repairs in sight, imagine the repairs that are out of sight, behind walls, under floors and so on. What looks like a small repair can end up costing thousands of dollars. Finding properties that are sound, especially after being inspected, is something that you should look for, and be willing to pay a bit more for. Caveat to that is the preceding paragraph.

I’m sure you’ve heard the saying “location, location, location” and it’s true.

Buy properties in locations that are in places that lend to better rents or resale of the property. Look at the type of property you are buying. If it’s a single family home, are there good schools in the area? Parks? If it’s a multi unit, what is around the area? Is there a college that will mean renting to students? Singles or younger couples needing a space close to work or entertainment? Location is key.

Buy smart and make money.

What To Do When You Have A “Needy” Tenant – Tips For Real Estate Investors

What To Do When You Have A "Needy" Tenant - Tips For Real Estate Investors

If you’ve been a landlord for awhile, you know all about them. If you haven’t, get ready because they are coming… the NEEDY tenant. There is no way around them. It’s especially awful when they are otherwise a great tenant – pays their rent on time, keeps the property in good shape. They just constantly need that hand holding and EVERYTHING repaired… NOW!

And have you noticed that it isn’t big things they need to have fixed? Stupid stuff, like it’s -2° F outside and they are complaining that the heat is CONSTANTLY running. Well, yeah, subzero temperatures will do that! Then there is the “well I thought I saw a bug so you need to get the exterminator in here IMMEDIATELY.” Yes, you guessed it, there was no bug or they let it in and it’s one measley fly.

The problem for you as the landlord is that when you are constantly calling in professionals to check on these rather stupid issues it costs you money…sometimes a lot of money.

So in order to keep your budget within the budget, set yourself up to succeed before they even move in. How? Make sure that things like the above will be covered once, then there is a service fee. Make it clear that if there is a flood, overflowing toilet or an electrical issue, that is a serious emergency will be covered.

If you don’t have something in the lease to help you and are having issues with a current tenant, try talking with your tenant, or writing to them. Make it clear to your tenant that if you are called about a repair and it turns out to be a non-emergency, the unnecessary repair or treatment will be at their expense.

If you write to them, assure them that you are taking preventative measures to forestall any issues, but that if they insist on calling about a non-issue, they will be charged. For instance, in the bug problem call the exterminator scenario, tell them “we have a standing monthly service contract with ___ Extermination and we will be happy to call a technician if you discover any pests. However, if no issue is found then the service call charge will be your responsibility.” Then spell out what will happen if the bill is not covered immediately (i.e. it will be taken out of the rent amount first, with rent second as described in the lease or however you will be handling it.)

Be friendly. Be professional. Definitely be firm. Once that tenant has to held accountable for unnecessary service calls, they will most likely stop calling and being such a needy tenant.

How To Invest In Real Estate In Your 20s

How To Invest In Real Estate In Your 20s

You’re a twenty something and are pondering the wisdom in investing in real estate. Friends tell you it’s nuts. Your parents probably think it’s a good idea. Really, though, can a twenty something invest in real estate? Is it even possible?

It is possible!

Of course it is. Let’s look at why. First, while you may not have much of a credit record, it’s less likely to be bad. If you’ve kept up on student loans, paid your credit cards on time or off and paid your other bills on time, you’re doing that adulting thing well. Well enough that you would be considered a decent risk for a mortgage.

The main problem you may come up against is lack of a down payment, or one that is big enough. Saving when you first get out on your own can be hard to do, especially when you are renting. You did put a security deposit on your rental. While counting on getting all of that back isn’t a great idea, it is something that can help. Even if you can put aside a small percentage of each paycheck it will build quickly. What can you cut out? $6 lattes? Eating out as frequently? How about getting out of that gym membership you never use? You can find ways to cut back and save money. In the long run it will be a bigger benefit.

Creative financing

Again, though, there are ways to work around it. If you are getting married use your wedding money towards the down payment. Ask your parents to chip in or partner with you. Work with your bank or Realtor to find creative ways to finance the purchase.

Use roommates

Once you have the home, a great way to make it work is to live in part of the home and rent out the other bedrooms. Your roommates can be the source of your mortgage payments. If you live with your parents rent all of the property to pay the mortgage and other expenses.

Remember that where there is a will, there is a way. Investing in real estate in your twenties is a great idea and a way to build wealth for yourself and your future.

What Is The Best Way To Invest In Real Estate In Denver

You live in Denver and want to get into real estate investing. So do you try to buy a multi unit building? What about a single family home? Your best bet is a single family home.

Less cost to get started

What Is The Best Way To Invest In Real Estate In Denver...You live in Denver and want to get into real estate investing. So do you try to buy a multi unit building? What about a single family home? Your best bet is a single family home.First and foremost, a single family home will cost you less to get started. The cost of purchasing a single family home is significantly less than a multi home unit, like an apartment building or duplex/triplex, etc. Beyond cost, for bigger buildings you would need special financing for multi units, as opposed to a typical mortgage for a single family home. The cost savings in that are big.

Multi unit property

Next, if you are purchasing a multi unit property the chances of buying all the multi units together can be challenging. This is especially true in a duplex/triplex property. If the homeowner in the other unit or units aren’t selling, you’re stuck with the challenge of trying to rent out a single attached unit.

Inventory concerns

Another plus to investing in single family properties is there is more inventory to choose from. Think about it, when you look online for single family homes, how many are available? A lot. Search for an attached unit or multi unit, and the choices suddenly get a lot smaller, which helps make those prices higher. Even in a buyers market there is more inventory of single family homes.

Preparing units for rent

Lastly, there is the cost of preparing multi units for rental, and the fact that you have a larger pool of tenants to choose from. Preparing several units for rental, updating, cleaning and repairing, can be very costly. Think about how much one home renovation costs and multiply it.

When you have a single family home, those updates and other expenses are less, even though the home probably has more square footage. Also, smaller multi units limit your tenant pool to singles, newly marrieds and so on. Renting out a single family home opens that pool of tenants up to families who may need more room than an apartment or smaller multi unit, but can’t or don’t want to buy.

If you are interested in learning more, give Tena D a call today to talk about your real estate investing options! 303-452-5853

Should You Get Into Real Estate Investing Now When the Market is so Hot?

Some say that getting into real estate investing when the market is hot is a bad idea. I disagree. Not only can you get into it without losing your shirt, but you should.

So why is it such a good idea?

Should You Get Into Real Estate Investing Now When the Market is so Hot?Well, think about it. Does everyone own a home? Of course not. In a hot market it is really hard for first time buyers to find an affordable property. They often get out bid on those that they can find. That leaves a large segment that still need a place to live.

Not everyone wants to buy a home

Often times those looking for that first home are doing so because they need a bigger space.
So how does that help you, the real estate investor with a single family home to rent? You have that bigger space they need. Since they can’t buy, they can rent. That means that your property will be in demand.

True too is the fact that not everyone wants to buy a home. That means more prospective tenants for you no matter the market.

Use a property management company

Now, as a smart real estate investor, you have a property management company working for you and they will vet prospective tenants and get your property rented in days and keep it rented for you.

So don’t listen to the naysayers. You can and should invest in a hot market. Help out those renters.