Buying an investment property is a great way to grow your wealth. If you’re looking for the best tips on how to buy investment properties, this post is for you.
More and more people are turning to real estate investing as a means to build wealth.
I’ve bought several rental properties in my lifetime and have learned many things along the way. Here are my top 5 tips on how to buy investment properties.
Do your Research
You do your research, find an area of the city where you want to buy the property, and move forward from there.
But you see some other investors buying certain types of houses in this area, but you are not sure why.
These types include terrace houses, houses with more bedrooms than average, or houses on big plots of land.
You may wonder why they do so when they are priced higher than others and take longer to sell.
The reason is that these properties are often rented out and therefore have a rental potential greater than what they cost on the market.
Get Professional Help
Once you have an idea of the type of property you wish to invest in, it is worth speaking to a few professionals dealing in that field to get their insights.
These could be estate agents, letting agents, Cohen Handler – Buyers Agent in Australia, or even local property professionals who can give you a balanced view on what you should be looking for.
They will also help with identifying whether it’s better to buy older lower-cost properties or up-and-coming areas where prices are rising fast.
There are numerous ways to invest your money, but the Real estate is considered one of the safest out there, this is because it’s divided into two markets for investment.
One is ‘Residential Land’ and the other being ‘Commercial Land’, each with its own pros and cons.
So don’t just get a quote from an estate agent. Speak to some individual property investors to get a well-rounded view of the future market they see in your desired location.
It might seem like a lot of effort to talk to people but believe me if you end up saving 10% on your house purchase by talking to 10 different people about the area.
If you were trying to rent out your apartment, how much would you charge per month? Your answer no doubt depends on what other two-bedroom flats are going for around the same area.
If it’s $800 a month, then you might as well ask for that price, right?
I have now clarified why it is not sensible to take a snapshot of the market and then apply it accordingly.
The correct way of evaluating a residential property is to consider all the relevant corresponding sales for similar properties in the same area.
This reveals an exact price that someone would be prepared to pay for your property because it helps you determine your property’s selling price and removes any guessing game over how much you can ask.