Did you know that home sale profits and return on investment are at their highest point in a decade, with an average profit of $85,000 per home sale? This is the market you want when getting ready to invest in real estate.
If you have been thinking of investing in real estate in Denver, there are some tips that can help you succeed. Read on to learn the real estate tips you need to invest wisely.
Real Estate Tips: Do Find the Right Location
Location is crucial when investing in real estate. You do not want to be stuck with a property in an area that is declining instead of growing. Look for a location where the population is growing or where a plan for revitalizing the area is underway.
The location you want is one with low property taxes, a good school district, and amenities like restaurants, shops, parks, and more. Bonuses are if the location is near public transportation and if the crime rate in the area is low.
Don't Overdo It on Remodeling
If the property is a fixer-upper, you want to make sure that the remodeling you do is within your budget. You want to make certain the property is in great condition before you rent it out so that you can get the rental value you want, but spending more on remodeling than you are likely to recuperate is a bad business decision.
Do Hire a Property Manager
You do not want to have to worry about the day-to-day duties that landlords have. When you hire a property manager, they will perform a number of tasks for you, including:
- Showing the property to tenants
- Property marketing
- Performing tenant screening
- Collecting rent on your behalf
- Handling tenant complaints
- Handling late rents and evictions
- Arranging maintenance work
All of these tasks take time. If you do not have the time to handle all of these issues yourself or if you do not want to do so, a property manager can be the best choice.
Don't Forget Unexpected Costs
Most investors in real estate assume that what can cut into their rental profits the most are maintenance and upkeep costs, but there are other factors. There are always emergencies to account for, like weather damage or burst pipes.
You want to set aside 20 to 30 percent of the rental income to be able to cover these costs when they arise.
Do Buy a Low-Cost Home
The larger and more expensive the home you purchase is the more you will have to spend to maintain it. You want to start in an up-and-coming neighborhood with a home in the range of $150,000 to $200,000. Although it can be tempting, avoid buying the nicest house on the block.
Get Expert Help
When you begin your real estate investing journey, you need to have experts by your side. At Investor's Realty, we can offer the property management and brokerage services you need.
Contact us today to get the real estate tips you need!