3 Things That Will Help Ensure a Profit on Your Real Estate Investment Property

If you’re entering the real estate investment market for the first time, you’re embarking on a great adventure – and with a solid plan, you can turn a tidy profit on your investment.

In my opinion, one of the keys to a successful real estate investment is choosing the right property. A really great property, with a little bit of strategy, will serve you well for years to come.

There are 3 things you should keep in mind for your next investment property to help ensure a profit for years to come:

The location of your investment property will be critical in the success of a few different factors.

For one, it’ll help in determining how much you earn on it and how long you’re able to keep tenants.

As the saying goes, you can change the color of the walls, you can change the type of flooring, and you can change the layout of the home, but you can’t change the location. So before you do anything else, make sure your new investment property is in an ideal spot.

Investment properties that end up being high cash-producing properties tend to have some things in common when it comes to their location.

They’re typically in neighborhoods with great schools and great amenities like pools, parks, movie theaters, and public transit.

You should also consider an area with quiet, low-traffic, well-kept streets. Great neighborhoods have a low crime rate and don’t typically mix housing types.

Aside from local amenities, you’ll also want to consider the average vacancy rate and rent price in your neighborhood. If you can’t cover your costs by charging the neighborhood’s average rent, then the home is a poor investment.

Keep an eye on vacancies in the neighborhood as well. If there are a high number of vacancies in the area, it could mean that the area’s rental market is seasonal or that renters are no longer interested in it. A low-vacancy area will allow you to charge more rent, and you’ll be more likely to find renters.

There are a lot of things you can change if you don’t like your home, but the floor plan is a challenge to rearrange. That means in order to make your property competitive on the market, you’ll want to choose a property with a modern floor plan. Watch the trends and buy a home with a floor plan that’s in demand – you’ll have an easier time finding tenants.

I’ll say this - one trend that I noticed last year was a shift in the desire for open floor plans.  People weren’t looking for them as earnestly as they had been for a few years, so that’s something to keep in mind moving forward into 2021 and the years to come.

Buying an investment property is a great decision if you’re willing to do the work, but it’s important that you choose a property that will turn a profit. One of the simplest ways to guarantee this is by working with a real estate agent who knows investing and loves to help people find the perfect investment properties for themselves.