Tips For Choosing Rental Properties That Are Guaranteed To Provide Phenomenal Returns
Tuesday, 28 February 2017, 10:45:00 AM
Purchasing rental property is a great way to establish long-term financial health. The right unit will serve as an ongoing, passive stream of income that can bolster or even replace earnings that are generated from your primary employment. This is an excellent investment strategy for retirees or for those who intend to leave the workforce within the next several years. It is also perfect for consumers who already own their own homes outright and are ready to expand their portfolios. In order to ensure optimal returns from this investment, however, there are a number of key features that you should look for.
A Prime Location
No matter what your goals are when shopping for property, location means everything. This is always going to be the sole feature about your unit that you don't have the power to change. You can alter the flooring, add in new cabinetry and even redesign the look of the property exterior. Where your investment is located, however, is a static condition. You also have to account for the fact that location will play the greatest role in determining how much you're able to charge for rent. Even if a unit has cutting-edge amenities, it won't fetch a reasonable price if it's situated in a high-crime, low-interest and otherwise undesirable neighbourhood.
Just like home buyers want the latest and most innovative amenities, property renters are starting to demand these things as well. Features like smart thermostats, triple and even quadruple-pane windows, and energy efficient heating and cooling systems can help renters save considerable sums of money on their monthly overhead bills. If any property you're targeting doesn't have these things, find out how much it will cost to add them in on your own.
A Robust Rental Market
Certain neighbourhoods are filled with attractive and relatively affordable houses, and yet, the local rental markets are not ideal. This is often the result of limited, local options in employment, limited options for commuting, or average rental prices that are far above the regional norm. Find out how other rental property owners are faring within specific neighbourhoods and determine just what the average rental costs are. These should be sufficiently high for covering your own ownership expenses while allowing for some manner of profit.
If you intend to invest in a multi-unit development or a property type that is best-suited to small and growing families, make sure to target neighbourhoods that have top-rated schools. Many properties will have local school information posted right on their listings. You can compare this data with the details that are offered by major school review sites online.
Low Crime Rates
Take a minute to read up on local crime statistics. Even some of the best locations are not immune to problems like burglary and vandalism. Not only will issues like these make your units less marketable, but they can also have a noticeable impact on property values over the years.
Ease Of Transportation
When shopping for homes, apartments or condos to rent, most people are looking for options that will simplify their daily commutes. As such, some of the best properties will be located within close driving distance of major transportation routes. It is also important to consider the options in local, municipal transportation that exist as well. With more consumers looking to limit both their fuel costs and their carbon footprints, choosing properties near solid bus routes or train stations is a good idea.
A Strong Job Market
A strong job market and a robust rental market usually go hand in hand. If there are plenty of options in nearby work, locals will be able to pay their rent. When shopping for an investment property, check around for new businesses, business expansion and low unemployment rates. It's also possible to find desirable rental properties just outside of bustling metropolitan areas, so long as the options for commuting are good.
When using investment property to generate passive income, it's vital to diligently research your options. Choosing a modern, updated home that located in a safe and top-rated community will invariably provide better returns than will choosing a property in a high-crime, low-interest district. Consulting with a reputable REALTORŪ before finalizing any purchase decisions is the best way to avoid investment mistakes that will diminish your profit potential.
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