THINKING OF BUYING AN INVESTMENT PROPERTY?
Have you been dreaming about buying a rental property and building an investment portfolio but aren’t sure where to start? Whether “rental property” means a multi-unit apartment building or a one-bedroom condo, the goal is the same— passive income.
If one of your goals is to own an investment property, I’ve got a few ways savvy investors evaluate properties to find profitable rental properties.
Location is key.
Remember, you’re not just investing in a property but also in a location.
It’s essential to consider the location and neighbourhood when looking for a rental property. Consider the proximity to local amenities, shopping, and employment opportunities, and also take into account the school district — better school districts typically attract better tenants.
Look for a property in an area with appreciation potential, and don’t forget to pay attention to taxes, as they will affect your cash flow and bottom line.
It’s important to select well-maintained homes or ones that can easily be updated. Sometimes, you can find a fixer-upper that needs minimal cosmetic updates that you can do cost-effectively to net a higher return. Nicer, more updated properties will attract quality tenants and higher rental rates.
Cash flow is crucial.
You can calculate the property’s cash flow by subtracting projected expenses from the potential rental income. Make sure you take into account insurance, taxes, any HOA fees, property maintenance, and management fees. Positive cash flow indicates a potentially profitable investment.
A knowledgeable agent (that’s me) can help you run the numbers to find a property with good cash flow that will appreciate.
Have questions about investing? Reach out! I would love to take the guesswork out of it for you and help you start earning passive income.