Owning your own home can be a great investment, particularly when you consider the long-term value appreciation of real estate compared to other asset classes. However, buying your first home or investing in real estate as an experienced property investor can be surprisingly complicated and downright scary if you don’t know what you’re doing. This guide has all the information you need about real estate to ensure that you make the right choice for your specific needs.
Location, location, location
Buying a home is one of life’s largest investments. If you want to maximize your return on investment, then it pays to carefully consider which areas offer greater potential for growth. Start by considering an area’s location—the further away from major commercial centers, well-traveled roads, and public transportation routes your home is located, the fewer desirable amenities it will have access to (restaurants, stores, gyms). Also make sure you check out what public services are offered in your prospective neighborhood; good schools can drastically increase property values over time. And even when considering less tangible factors like vibes and aesthetics, think about how your surroundings may affect how much enjoyment you get out of owning a home here.
The best type of property investment depends on your goals
Whether you want to be a landlord, a property investor or a developer, there are different factors that will come into play. Do some research and decide which is best for your needs before making an investment in real estate. Whether it’s your primary residence or a more financially-motivated buy, understanding what makes one type of property better than another is crucial for ensuring that your investment succeeds. Here’s what you need to know about your options—and why they’re important.
Finding the right property manager will ensure maximum returns
Finding a good property manager can make all of the difference in whether your investment is successful or not. To do so, look for a firm that has been established for at least five years and has been recognized with local awards. In addition, you’ll want to hire someone who understands what it takes to invest in properties but also understands local market conditions. One way to ensure that a candidate meets these criteria is by asking for specific examples of situations that he or she has handled successfully in your area. Ask whether he or she was able to negotiate lower rents with tenants who were looking to move into higher-end homes, how he or she dealt with problem tenants and anything else that may be relevant in your community.
Renting out property is never a good idea
If you’re a landlord, chances are good that it’s because, at some point in your life, someone talked you into thinking that it would be a good idea. And chances are also good that if something in your life isn’t producing income for you—regardless of how simple or fun it may be—you shouldn’t expect it to suddenly become profitable. If you want to make money from real estate, stick with being a property owner and rent to tenants who can pay their rent reliably and on time. You don’t have time to be a bad landlord.