We are going to cover the most important things a real estate investor should consider when purchasing a property.
Before purchasing a property, the first thing to do is to ensure that the area is in your preferred region. Even if you are looking for an investment, buying somewhere you know you like and are familiar with is imperative.
Another important thing to know is the rental income potential of your purchase. Not just on a year-to-year basis but also on a long-term basis. Generally, a 2% vacancy rate or lower is considered suitable for property investors looking for high cash flow and high return on their investment capital over time.
Here are important things you should look for before buying a property:
Location: Location and size are two important considerations while buying real estate property. It is advisable to buy an apartment close to your workplace and offers plenty of parking space or access to public transport.
Outdoor Amenities: The neighborhood has its amenities you would be living near – parks, malls, sports venues, etc. Consider the outdoor amenities and estimate whether they suit your lifestyle or not.
Property Type: If you are looking for an investment-oriented property, it is advisable to go for an apartment in a new building that has amenities such as a gymnasium.
Here are four key things that you should do in your research:
– Verification of property ownership
– Verification of property taxes
– Inspection of structural integrity
– Checklist for risks of the neighborhood
Initially, we need to consider the buying price. It should be enough to cover the mortgage and other costs, but not too expensive. We also need to look at location decisions – consider whether it will be close enough for us to get around. Another factor is transportation – can you drive there or would you need a car every day?
You should also consider whether you can afford it in the long term or not. Remember that if something goes wrong with your work or something else happens, that house might become a burden you don’t want.