If you own an investment property, you’ve probably already seen the advantages at work. If you’ve done your homework, you are probably making a decent side income from renting out your property. So much so, in fact, that you might be considering purchasing another property to ramp up your profits even more.
If you’re considering taking this big step, don’t do it lightly! Property ownership can be lucrative, but you should also make sure you are ready to commit to the investment you’ll need to put into it. Here are a few things you should consider before you purchase your next investment property.
What type of property are you looking for?
Don’t think that you have to buy the same type of property you already own. You could think about buying a single-family home, a condo in a complex, or a vacation home. Do some research to determine what’s available in your area, what pricing is like for each of these options, and what you can charge for rent.
Figure out the finances.
You might want to talk to a realtor or property management company to help you out here. You’ll need to think about your down payment, tax implications, insurance costs, and available cash before you consider taking real action towards purchasing anything. The ultimate goal is for your property to be a great investment, so make sure you don’t put yourself too far behind, right from the beginning!
Talk to others who have been there and done that.
All the online research in the world can’t really replace solid, first-hand experience from someone who actually owns multiple properties. Ask around—chances are you’ll be able to find someone that can give you a little bit of advice and get you started on the right foot.
Don’t go it alone.
Since you already own your first property, you probably have a decent network built up of people who are helping you maintain and manage the home. Use this team to your advantage when it comes to buying your next property. Talk to your realtor about property values, or ask contractors and repairmen about costs to fix up a potential property.
Get all the right tools.
Going from a single property to multiple properties can get pretty complicated, pretty fast. You are most likely going to want help managing your finances, drawing up rental agreements, determining lease terms, and qualifying for good loans. There are many decent online tools available to you, but your best bet is going to be help from real people.
Finding a great property management company can make all the difference when it comes to making sure your investment properties don’t turn into a giant hassle. These companies help you with everything from marketing and contracts, to rent collection and evictions. Don’t ignore this great tool that’s available to you; it’s more than worth it!
Investing in real estate has long been a popular option for those looking to beat the stock market and become financially independent. If you’re ready to make the jump from a single property owner to a multiple property investor, follow these tips to stay on top of things and get your new career off to a good start!
Real Property Management has been helping investors manage the investment properties for years. With an experienced team and a proven process, RPM can help you with your expenses, your tenants, your maintenance, your inspections, and many other aspects of property ownership. Contact us today, or give us a call at 480-719-1243 to find out how we can help you make the most of your investments.