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Buying a property for investment is no easy task. Like with any investment, one should get educated first, then do some market research and seek the advice of experts.
Ideally, one should consider several factors when selecting a property; for example if you are buying a home, the proximity to good schools is often key in renting to young couples looking to start a family; typically a 3 bedroom single family home will be most desirable in this case. Other factors to consider are: proximity to shopping areas and highways.
Location remains the single most important element for success in Real Estate, but other important points should not be overlooked, like identifying who your target renter is and what is the future of the neighborhood where you intent to buy. A little of market intelligence is required, therefore you should check with the building and zoning department to possibly determine the direction the area is heading or seeking the advice of and experienced licensed Rental Agent or Real Estate investor can be the best way to go.
When buying a home for investment is important to consider out of pocket expenses, such as repairs, lending fees and down payments. Remember, at the beginning, the rent should at least cover the mortgage, appreciation and capital gain comes later. If you choose a home that just needs some cosmetic repairs or upgrades and is located in a good neighborhood, seems to be a winning combination but you should also check what would the rent be for similar homes in the area and determine how long you plan to keep the property to possibly ascertain whether it would be a good investment or not. Analyzing the price fluctuation of similar houses in the area can tell you how long you need to keep the property to make a profit. Appreciation of similar homes in the neighborhood in a determined time frame is often subject to zoning laws and new home construction.
Perhaps you should consider the services of a licensed rental agent if you live away from the property, in addition to collecting the rent; they will assist you with investigating the background, job and credit of a possible renter, these are important factors in minimizing the risk. They will also advertise for the property and can evict tenants if necessary. Additional protection from possible law suits can be achieved by incorporating in a Limited Liability Corporation, and attorney can better explain the benefits of this strategy.
A licensed rental agent can be you best allied and can walk you through due diligence such as inspections, financing and knows other professionals like insurance gents, title services and contractors in case you have to do some repairs. Their fees usually are a start up fee and a negotiable percentage of the rent.
Attend to some seminars in the field, many organizations offer them at no charge or join a group of peers, Fannie Mae for example offers free seminars on How to buy a property, How to pre-qualify to buy, tax benefits to help cash flow among other topics. One can find many sources of information in the Internet or you can join groups like Triangle Real Estate Association they offer the benefits of networking and have regularly scheduled seminars. Popular sites to obtain information are: www.realestatelink.net www.thecreativeinvestors.com and www.mrlandord.com or traditional sources such as books and guides.
Experts offering advice on how to achieve success in Real Estate investments, all concur; educating yourself, become empowered, before taking the risk is the key to avoid being stuck with a lemon.
GBrey | 
