Where do I start if I want to acquire investment property?
Investment properties differ greatly from purchasing a home for yourself. Investment loans have a different set of rules and there are many things to consider when you decide to acquire an investment property. Purchasing the wrong investment property can cost you thousands and you could even lose your investment. If you get the wrong advice on the potential return of an investment home, you could end up having to cover a monthly negative that you weren't prepared for. The first thing to do when you want to invest in real estate is talk to a Realtor. There are different types of real estate investments and you should know your options before you begin your search.
Is flipping houses a good way to make money?
The real estate boom that occurred in the early 2000's created a perception that flipping houses is an easy way to make a lot of money. While it is possible to flip a house and make a profit, it is much more work that it may appear and may not be the best course of action. If you are considering purchasing a house to renovate and sell for a profit you need the 'perfect storm' of events to occur. You must be able to purchase the home far below market value and that is a very rare opportunity. Then you need to factor the cost of renovations and expect that cost to be higher than your initial estimates. Lastly, you have to predict the future value of the renovated home. This last step is very difficult to do when the real estate market is constantly changing. In a market that is moving strongly upward in price, you are more likely to see a profit on your investment. However in a flat or downward trending market, every day you spend making renovations, you are losing valuable time and possibly value on the home itself. This very reason is why you should consult with a Realtor before jumping into this decision. We want your investments to yield years of return for you, not headaches.
What types of investment properties are available?
The most common investment property is rental homes but that doesn't mean that is the best one for you. You may also consider commercial properties and even land. The best one for you depends on your goals and your expected involvement. Commercial properties can be tricky and usually require the assistance of a professional commercial property manager. Rental homes don't necessarily require a property manager but it may be the better option for your situation. We can help you factor all the details of investing in real estate and arrive at a solution that suits you, even if that means not investing in real estate! This isn't an investment for everyone and we want to help you be objective in your investment decision.
How do I find a property manager?
This depends on the type of property you need to manage. There are many businesses that only do property management but their fees may be higher than you are willing to pay. If you need a property manager for any reason, it is a good idea to consult with a Realtor even if they don't intend to be a property manager. We love to help people and if you need assistance finding a professional manager, we believe that it is a good investment of our time to help you even if there is no immediate return.