So you’ve decided to start buying investment properties? Awesome! It’s a great way to add extra income to your household!
With careful planning, common sense, some outside help, and sheer determination investment properties can be the most successful career path you’ve ever followed.
Over the next few weeks we’ll be doling out some helpful advice for first time investment property buyers. First and foremost though, you have to know your goals.
To Flip or Not To Flip
What do you plan on doing with your investment property? Are you going to buy a fixer upper, remodel it, and sell it for a higher value? This can put a large chunk of cash into your wallet, but also take a lot out.
Any time you plan on making drastic repairs you have to know your cash flow and stay with in your budget. Having a strict budget and understanding how much each repair will likely cost you is important, and a tip we will be covering later this week.
On the flip side of this (ha!) getting that money back and then some when you sell the home is worth the stress and hard work, and then some.
Flipping might not be your end game though. If you’re more into smaller monthly pay outs, then renting might be for you. With a rental you don’t have to worry as much about turning a low priced home into a high priced one.
When renting you don’t want to buy a property that needs a lot of work because your money isn’t coming from the sale. You want to get your home on the renters market as fast as possible so you can start collecting rent quick.
Why it Matters
Knowing what your goals may be changes a lot of variables for you. Some neighborhoods would be great for a flip, but terrible for a rental. You need to pay close attention to the market no matter what your goals are, but what you may look for in a market will change depending on your plans for the property.
Knowing your goals is truly the first step in investment properties as it dictates every decision you will need to make.
If you have questions about what may be right for you, ask a Realtor. Our team is always here to help.