Five things you must look at before you purchase a investment property

Five things you must look at before you purchase a investment property

The first thing you definitely want to look at is the quality of the neighborhood and the property. This is important to make sure you get consistent rents in the area your purchasing your property in. I personally like more established areas because of the age and I can get a better idea of how good the neighborhood really is. Example if you have a more established neighborhood mature properties you get a better idea how the area upkeep will be. Newer areas sometimes look great at first but suffer later because of bad buyers and people not desiring the area a longer.

The second thing you need to look at is the numbers, a lot of homes look great at first, but you need to see what the profit will be before you fall in love with the property. I always look at the rent minus the insurance, taxes, and property management. This will give you a great idea of your net profit if you don't have a mortgage on your property. I always stay with the best priced homes in the best priced areas so in this story we will be talking about cash deals

The third thing you must have is a good team around you to handle all the issues associated with your investment property. Most investors sometimes forget what they will need two years down the line after the property needs a little maintenance. So make sure you have a great team to handle all your construction, purchase, maintenance, insurance, property management, and all the other little issues that might arise while you have your cash flow property.

Number four would be the return on the investment property that you're buying. In this market although I think we have a short time left should be around 12% or better. That does not include the equity position in the property is just the rental or lease option return that you're getting at this time. With the market the way it is today you need great returns because of the lack of lending for home buyers in this market. That's why investors are prospering so much in this market because of the high rate of returns in some areas. Our team buys in the Cleveland Ohio area suburbs and we average 15% or better on our properties

The number five reason and final one for this story is being able to get properties. In this market. I know in some areas is hard to buy the property especially investment property. So make sure when you go to an area they have a decent amount of inventory. You need to be able to buy as many homes you want and be comfortable that you can get enough properties to add your portfolio. A lot of investment strategies go right out the window if you can't buy any properties. So be sure that the area you want has the inventory for you to continue investing for the long term.

One final addition is to make sure you stay in larger cities. I like 1 million or more. This ensures you have a large pool of tenants to choose from. You will also get better prices on the maintenance issues.

If you want to go see in our areas please check out rooftopvideo.com I have a lot of homes on their and areas can see. You can also check out some of my great deals just click here to view. Brett young Valley Realty