We’ve all heard of at least one person who made a fortune by investing in real estate. Maybe they amassed wealth through flipping houses, or maybe they’ve done well by renting out vacation homes on AirBnB.
These stories make real estate investment look very attractive. And it’s true that even in a fluctuating market, real estate remains one of the most solid investments you can make. But successful investment in real estate is not automatic. Here are some tips to make this opportunity a success.
Find the Right Location.
The best investment for real estate is in a neighborhood with a growing population rather than a declining one.
Set a Budget
Always set aside 50% of your budget for expenses, especially when you’re first starting out. Maintenance and repair costs frequently add up to more than owners anticipate.
Save For Emergency Expenses
Storm damage and frozen pipes are expensive realities which can pop up without warning, so be ready.
Decide If You Need a Property Manager
Don’t overestimate your time and ability when it cames to managing your own property. Be prepared to outsource help with this when needed.
Get Familiar With the Market
Keep track of what the market is doing in your area so you can make an informed decision about when to buy or sell.
Buy a Low-Cost Home
As with an any investment, your goal should be a high return on every dollar you spent. One way to maximize your return on investment is by purchasing modestly-priced (but not “cheap”) property.
Calculate Your Operating Costs Carefully
Expect operating expenses to cost anywhere between 35% and 80% of your rental income.
Don’t Overdo It On Rehabbing
Unless you’re renting out a luxury, high-end property, don’t overspend on fancy accents and fixtures.
With these tips in mind, don’t hesitate to reach out to D Realty to get started on your next real investment venture in Albuquerque today.