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Investing in real estate to rehab a house or rent it for income is an exciting way to build revenue while working creatively with properties. However, this type of venture requires some basic knowledge of the real estate market as well as how to flip or rent a property of your choosing. When considering which property to buy, here are four essential things you should know.
Location Is Key
What all the familiar real estate ads say is true: location is everything. Look for a property in a good location for the purpose you have in mind. If you plan to rehab the property and sell it, choose a neighborhood that attracts the type of buyers you have in mind. When renting a property is your goal, find a rental unit in a location that is close enough to business to be convenient but situated in the suburbs for a home-like setting.
Evaluate the Market Potential
Whether you plan to flip or rent your new property, discuss the realty market with a real estate agent for an idea of what to expect. Depending on your area, there may be higher-activity market periods during the year when you want to put your rehabbed property up for sale. Although renters can be found anytime during the year, some parents and families with children prefer to wait for the summer months to move into a new apartment so they don’t have to disrupt their kids’ school schedule. The real estate agent can advise you about the marketing trends in your area.
Get a Professional Inspection
Before finalizing a purchase of your first real estate investment property, schedule an inspection by a licensed professional home inspector. The inspector will provide a detailed property report, inside and outside, with photos and suggestions for addressing any existing or developing issues. Common concerns include the roof, structure, foundation, windows, mold, termites, and other problems that can be found in properties of all types and ages.
Plan for Maintenance and Upkeep
When selecting a property to buy for whatever investment purpose you have in mind, remember to factor in additional costs for lawn care, gutter cleaning, and any repairs that need to be done while you own the property. In addition to a mortgage payment (unless you pay cash for the property), you will need to budget for utilities, insurance, and taxes.
Real estate investment is one of the best ways to secure your future. Plan carefully when choosing a property to buy, and make sure you have all relevant information about its condition before confirming the purchase.
Anita Ginsberg is a freelance writer from Denver, CO. She studied at Colorado State University, and now writes articles about health, business, family and finance. A mother of two, she enjoys traveling with her family whenever she isn’t writing. You can follow her on Twitter @anitaginsburg
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