There are few surer ways of making money than investing in real estate. Not only can you potentially strengthen your financial position and generate wealth, it also means you’ll have a product that will be in demand as long as people need a place to rest their heads. But how do you choose your first investment property? There are a few things you’ll need to bear in mind.
Location
You’ve surely heard the old saying: “There are only three things that matter in real estate: location, location, location.” When it comes to looking for your first investment property, it needs to be a place where you think people will actually want to live. Furthermore, look beyond the general positioning: are there reputable schools nearby? Shops? Public transport options? These are just some of the things that potential tenants will look for. The more facilities and amenities you can tick off, the more likely your first investment will work in your favour. Lastly, look for neighbourhoods where property values are rising, even if they’re not the ones where you would like to live.
Think with your head, not your heart
When you’re buying your first investment property, it’s easy to get carried away. One thing to avoid is buying the exact type of home you’d love to live in. The problem is, when you let yourself fall in love with a property, it’s easy to ignore its foibles. It’s also good to bear in mind that the future tenants will have different expectations to a homeowner: the key here is to think rationally. Keep this in mind when you renovate it to your personal tastes to attract tenants. While a spa in the bathroom or a granite benchtop might sound appealing, it’s a potential waste of money for an investment property as your tastes may differ from your tenant’s.
Seek a home that’s low maintenance
Following on from the previous point, you also want your first investment property to be as low maintenance as possible. While it might be tempting to look at a ‘fixer-upper’ that you can renovate, it’s most likely a bad idea. For one, your large-scale home improvements will end up costing a lot of money. Secondly, you probably don’t want to spend all your time painting, weeding or taking part in any laborious activities.
Think about what kind of tenants to attract
When you’re looking over a property, think about what kind of person would want to live there and why. If the property is near a university, you’ll probably think about advertising it to students. This means a one-bedroom apartment might be ideal. Alternatively, if you’re looking to appeal to a small family, you may want to invest in a property that has a minimum of two bedrooms.
Get in touch with Cohen Handler
Whichever way you choose to get started in real estate investment, you’ll need a trustworthy agency at your side to provide good advice and research. Speak to the experts at Cohen Handler, who will be able to address any questions you might have and guide you towards getting your foot in the door.