Choosing Rentals that Make Sense: 3 No-Nonsense Tips

by Kitty Bernard 01/12/2020

Photo by Photo Mix via Pixabay

For many investors, purchasing a property to rent out just makes sense. But finding properties that'll help you meet your long-term goals can be tricky. Whether you're considering a turnkey property or a property to rehab and rent yourself, keeping these tips in mind will help you weed out low-performers while you're hunting for a solid investment.

Tip 1: Run the Numbers 

For experienced investors, this is probably a no-brainer. For beginners, it's a smart reminder. When you're seriously considering any property, you need a solid expectation of the expenses associated with the property:

  • How much your mortgage will cost 
  • How much you'll pay in property tax and insurance 
  • Fees charged by a property management firm, if applicable 
  • HOA fees, if applicable 
  • Vacancy and repair costs 

Compare those numbers with the amount you can expect to receive in rental income each month. Ideally, you'll receive more each month than you'll be spending on the property. In some cases, a property might be worth purchasing even if you aren't going to pocket money each month. That comes down to your long-term goals and the market where you live. 

Tip 2: Buy in A Market You Know 

Though sometimes the best markets are far from home, and we'll the last to discourage investors from looking outside their own county, it's vital to understand the area. Some examples: 

  • College alumni might choose to buy near their alma mater
  • Retired or active duty military might choose to buy an investment property near a military base
  • Nurses might purchase an investment property catering to short-term nurses near their hospital 

If you're able to land an investment property in an area that caters to your niche, you'll already have valuable insight and an "in" when it comes to renting it out and understanding the real estate market in the area. Use your insight to give you an edge. 

Tip 3: Consider a Small Multi-Unit Property 

By purchasing a duplex, triplex, or quad you can live in, you can take advantage of an FHA mortgage--with its low down payment and interest rates--and secure a primary residence as well as a rental property (or two, or three). Although this type of investment can require more hassle, more tenant screenings, and more time in managing tenants and repairs, it can be a solid place to begin an investment portfolio. 

About the Author
Author

Kitty Bernard

Welcome to my website, your number one source for Reston, VA Real Estate, Herndon, VA Real Estate, Sterling, VA Real Estate, and surrounding towns. Are you looking to move to the Northern Virginia area? Do you want to sell your current home? Do you need a bigger home for your growing family? No matter your real estate needs, The Kitty Bernard Team is here to help you every step of the way. The Premier Real Estate Team Serving Northern Virginia As part of Century 21 Redwood Realty, a firm that has been in business for more than 40 years, The Kitty Bernard Team is a full-service real estate company with extensive knowledge of the region’s local markets. And they maintain an excellent relationship with many of the areas real estate professionals. Our real estate agents are qualified to serve each buyer and provide answers to any questions they may have. We offer our services to those looking to buy or sell a home within the Northern Virginia area. Kitty Bernard, owner and agent of The Kitty Bernard Team, has the knowledge and skills needed to help the needs of every client. Our team works hard to ensure that the selling or buying process is stress-free and happens without issue. Whether You Are Buying or Selling – We'll Help You Through It! We stand committed to finding each client exactly what will make them happy and fit their needs, as well as their budget. We go the extra mile to help every client achieve their goals, while staying up to date on any changes occurring in the world of real estate. For a real estate team you can trust, contact The Kitty Bernard Team today. Allow our years of experience and dedication work for you!