1,052,321
If you've never been a landlord, you may need to start there.
Is there competent property management? NOT easy to come by. Find out.
Will you self-manage? If so, do you have decent accounting software?
Market rents. What areas, properties (and property types) will allow you to raise rents over time? Do you know your desired yield and how to obtain it?
ARE THERE decent vendors for property maintenance, repairs, etc?
Legal resources for evictions or forming an LLC for the property?
Talk with your CPA/tax person about the financial implications.
Location.
Costs in addition to mortgage payment--assessments, HOA, insurance etc. (back to yield)
Do you have the intestinal fortitute to be a landlord? Not all do. (I hate it and have to be 'arm's length')
And appreciation, depreciation, cash flow . . .
These are a few of my favorite things . . . 3:)
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Ryan Huggins - Thousan...
Thousand Oaks, CA
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Tony and Suzanne Marri...
Scottsdale, AZ
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Fred Griffin Florida R...
Tallahassee, FL
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Bob Crane
Stevens Point, WI
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Kevin J. May
Hobe Sound, FL
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Debe Maxwell, CRS
Charlotte, NC
5,230,164
Well, Candice A. Donofrio nailed this one!
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Kevin J. May
Hobe Sound, FL
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Candice A. Donofrio
Fort Mohave, AZ
1,503,048
Candice A. Donofrio has your answer!
For me, I look at what I could get for it, what my monthly mortgage would be, if there are any HOA dues and what the insurance, maintenance and taxes would be. I get a monthly amount for all of those and add it to my mortgage payment. If the profit is there and at a level that meets my minimum requirements, I'm happy and purchase the property.
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Candice A. Donofrio
Fort Mohave, AZ
3,071,489
Candice A. Donofrio nailed this one!
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Candice A. Donofrio
Fort Mohave, AZ
2,684,209
5,049,488
I think you should pay close attention to Candice A. Donofrio . ROI is certainly an important consideration.
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Candice A. Donofrio
Fort Mohave, AZ
1,153,794
So many questions to answer before taking up the prospect. Will you be managing the property? Can you cover expenses if it takes a while to find a tenant? A six month reserve is recommended. This is a business, can you treat it as such? Who pays what in regard to maintenance and utilities? These can be killers. Will you be able to fully benefit from the tax advantages? Being a landlord invariably can consume your time. Do you have the flexibility to respond to tenant's needs quickly?
Management fees can exceed 18% of gross rent if you are seeking are more "hands off" ownership. Even with that there's always incidental expenses that pop up. Are you ready?
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Candice A. Donofrio
Fort Mohave, AZ
5,868,699
864,658
The draws of the community. In our area, a downstairs bedroom with bath is an essential feature for a lot of relocating families.
5,217,433
Get a home inspection! Understand useful life of roof, HVAC and apppliances. Determine the rental market and vacancy factors! Are you handy? Can you handle the stress tenants can create! Do you have reserves if you have to evict and the money for an attorney?
Still thinking about it! You can be successful!
989,652
Do you have experience as a landlord and repair person? If not hire a property mgmt co.
There are many, many issues to investigate before buying rental property.
I've owned rentals for over 20 years, it's no small task or decision
1,617,916
great location, near schools and decent appreciation. I can rent these ones all day long
2,436,470
You already received a ton of good suggestions here. A lot goes into purchasing property as an investment.
4,434,127
4,272,548
599,274
There are a thousand things to consider. How strong is the rental market? What class of neighborhood is it in? Is this a turn-key property or will it require some upgrades first? Is it a new home that wil require little maintenance or is it an older home that will require a lot of maintenance over the years? What is your rate of return? Cash-on-cash? Capex? Equity growth? Will you manage it or hire someone? If hiring someone, do you already have a capable manager picked out?
I could go on all day. If you are serious about starting out, I recommend you visit www.biggerpockets.com and network with thousands of investors around the country. You may even find someone in your local area that can help you with this deal.
1,765
Here on Kauai this is a common transaction. Princevillet is a resort community and most investors want a place that they can enjoy for vacations and rent out the rest of the year. Location, location, location...everyone wants an ocean view. There aren't nearly enough to satisfy the demand and those properties that do have the view are priced considerably higher than an equivalent unit without the view. Mountain views (which we also have) are lovely too, but don't command the same price.
The choice of a quality property management team is essential. A great property manager markets the unit well so it is rented out a high percentage of the year. Also, the owner needs to know that his property is beautifully presented to every guest and that someone is there to immediately respond to the visitors' needs.
Of course, furnishing the property in an appealing and comfortable way is essential. Here we are a beach community, so stocking the rental with lots of beach goodies (boogie boards, beach chairs, umbrellas, beach towels, etc.) can make a big difference in the visitors perception of their experience.
This has addressed short-term vacation rentals which is what we deal with here. Hope it has been helpful.
6,393,609
I could write a book on this.
- Who is your target tenant?
- What do they want?
- Where do they want it?
- What are they willing to pay?
- What will it cost to buy this and run it?
and so much more.
2,224,473
You will want to look at your return on investment. Will you be able to cover repairs yourself, or will you need to hire someone? Really there are so many questions that need to be considered.
4,800,082
1,712,676
900,278
4,319,419
679,404
711,852
3,416,038
I think you not only need to look at the potential income, but expenses. Not just the mortgage, taxes and insuramce, but maintenance, short term, long term, landscaping etc. The condition of the property will affect how much it costs to maintain it
764,033
1- Is renting allowed
2- Will the property be easy to lease
3- Will the cash flow be sufficient
4- Will the value of the property rise
5- Am I capable of being a landlord
5,772,575
Steve,
I agree with Barbara Todaro . Definitely talk to your accountant, and go over the numbers. A
1,239,901
1,466,207
3,345,257
Know the numbers ... know what you want for an ROI ... and make an informed decision about the purchase.
2,781,313
5,583,278
know the numbers .... sit with an accountant and have your accountant explain the advantages and disadvantages....