In Part 3 of how to get started in Baton Rouge Property Investing, I am going to provide you with some tips on how to greatly increase the odds of generating cash flow, asset appreciation or equity build up in a property you purchase.
Buy the right property – while this is an over simplification there are a few things to keep in mind when trying to select an investment home. For many, this will be their first investment property, so there is no need to try and hit a home run the first time, a single will be good enough. If you are not in to baseball analogies, this means it’s ok to start small and be conservative. Your goal is to just get started.
Is the home located in a stable neighborhood that people want to live in? If there a large number of vacant homes that may be a sign of bad things to come. Location is important for investment homes just as it is for other forms of real estate. Having a university, large shopping area, entertainment districts or other attractions can certainly help attract people to want to live in your home.
Evaluate the property –this is perhaps the most important part of real estate investing. You will want to take into account how much the property costs to buy, how much repairs or upgrades you will have to do, the costs of acquiring and holding on to the property and for how much you can rent the home. Property evaluation can be as simple or as complicated as you would like depending on your personality and your tolerance for risk but it is very necessary and it must be done. If you are not skilled or comfortable with property evaluation you should look for a Realtor who is experienced in working with property investors and one who can help you with advanced analysis.
Other ways to lower your costs –have a property inspection which will help point out defects of the property. Home warranties can help with unforeseen maintenance issues as well as implementing a preventative maintenance program. One other step you should take before you buy a property is to have an appraisal done. The role of the appraiser is to be an unbiased third party that uses past sales, market conditions, details of the property and a list of other factors to determine the value of the property. This helps the buyer know how much the property is worth before they purchase so they don’t pay too much.
If I can answer any residential property investing questions you may have or help you make a purchase please contact me at firstname.lastname@example.org.