Purchasing a rental property can be an excellent investment. Over time, real estate values tend to appreciate, plus owning rental property will allow you to purchase real estate while your tenants actually pay for the mortgage and taxes. However, you definitely should take your time when deciding which rental property to buy. There are several factors you should keep in mind when making a decision.
Without a doubt, location should be one of the most important factors you consider when looking for a rental property. A desirable location will make your property much easier to keep rented. The location will also give you a good indicator of the types of tenants you can expect. For example, purchasing a rental property near a university will guarantee that you will always have students trying to rent from you. However, the cycle of the school year means that if you rent to students you will potentially face up to three months of vacancy a year.
Be sure to take note of the schools in the area around a rental property you are considering. Good schools will make your rental property more desirable to renters, while bad schools can actually lower the value of the home and make it harder to rent. Check the neighborhood for amenities like parks, shopping, entertainment venues like movie theaters, and access to public transportation. Being located near all or any of those tends to make a rental property more desirable to renters.
You definitely want to take an unbiased approach to selecting a rental property to purchase. Unlike when shopping for your primary residence, buying a rental property should be a process devoid of emotion. You are looking for a property that you can get for a good price that will net you positive income by renting it out. To that end, you should definitely check out the average rents being paid for other similar properties in the neighborhood before you make a purchase. That way you can be sure the rent you plan to charge will cover all of your expenses like the mortgage, insurance, and taxes.
If you want to deal with managing the rental property yourself, you should choose a rental property that is relatively close to where you live. However, if you choose to use the services of a quality property management company to oversee the property for you, then proximity to your home is no longer an issue. In fact, many people from out of state choose to purchase rental property in the Phoenix and Tucson areas because they are such great rental markets.
If you decide to purchase rental property in the Phoenix or Tucson areas, you can trust the experienced team at Fort Lowell Realty and Property Management to manage your rental property and look out for your interests. Give us a call or contact us today!