How to Find Good Investment Property

The topic that will be explained in this article is the way to find good investment property. Owning rental real estate seems to be more and more popular as investor tire of the swoops and swoons of the stock market. As for our information, not everyone has what it takes to be a landlord. But those who do may find out that rental will be a good way to build wealth. After we have decided to buy rental property, our real work begins. To find a profitable rental property usually takes a long time, connections and plenty of research.

To find good investment property, we need to know our time horizon. As it is the same as any other investment, we must have a plan or idea on the period we want to own a rental property before we buy it.

The longer the period we plan to own the property, the more we’ll probably need to invest in maintenance, improvements and repairs. If we’re keeping it for 20 or 15 years, at some point, it means that we will be putting a new roof on that property. In addition, we will be putting in new appliances and doing some major repairs. If we are only planning to own a property for four or five years, by contrast, we will probably want to avoid making any major improvements unless we are confident that we can recoup the cost with a higher sale price.

There will also a greater risk that we will face within a shorter time horizon. Although our rental will almost certainly appreciate over 15 years, but it could easily lose all the value in the following next five, especially if we are buying in an overheated market. We will need a higher amount of potential annual return to make up for that risk.

As for small investors, they might prefer long-term ownership. We will have plenty of time to achieve great result in the market, and rental income can make a nice supplement to our day job. Find more rental properties, and being a landlord may become our daily job.

Lastly, we need to develop a network. Landlords that have greater experience might find their properties in a variety of ways. Some of them will hunt for foreclosures, making friends with bank employees and city hall clerks or who has information on which properties are about to be sold. Some of them run promotion in local newspapers. Meantime, others might work with real estate agents that keep their eyes peeled for possible buys. Some of the landlords might be joining a local landlord and property owner’s association to make contacts and good relationship. It is believed that when we begin to own rentals, all the other investors start coming out of the woodwork.