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The property market in Rochester, NY, is strong, with listed properties often receiving more than one offer from prospective buyers. If you want to become a landlord, this is an ideal place to look at. Buying rental real estate can be a great investment, an amazing business venture, and a steady source of income. However, factors such as location and securing good rental management can greatly impact your ability to make it profitable. It's a no-brainer that location sets the precedent for success in property investment, and Rochester, NY, is at the top of the list of recommended places to invest in rental real estate. The employment rate is high, and the city hosts a plethora of amenities, such as good private and public schools, parks, shopping centers, and local attractions to suit tenants of different economic statuses. Furthermore, it is a hub of various industries and commercial businesses, hence the strong economy. There are also other factors to consider to become a successful landlord, here are some of them. Financing It is vital to take stock of the costs you will incur to acquire the property before committing to anything. If you’re not financing the investment from your own pocket, you will need to apply for a mortgage. Some lenders require a down payment ranging from 3% to 20%, and to qualify, your credit score should be a minimum of 620. But to have a higher chance of qualifying, a good credit score of 720 or higher is much more acceptable. (General guideline.) When your loan application is approved, you’ll have to consider your monthly repayments, which will include added interest. It is also worth noting that lenders charge higher interest rates for mortgages because of the higher risk. Demands of Ownership Owning a rental means being available to deal with daily responsibilities. Some of the responsibilities include attending to tenants' grievances within a reasonable time, seeking the right tenants, screening their applications, collecting rent, and marketing. You can outsource these responsibilities to a good rental management company if you don’t have the time or the skills to do it. A professional property manager will ensure everything runs smoothly and even give advice on reaching your financial goals. Know the Costs Involved There are many costs aspiring landlords need to budget for that can eat away at profit – so it’s very important to understand them. They include ongoing maintenance costs, insurance, and taxes. An emergency fund is also a wise idea, to cover unplanned financial outlays such as roof damage, for instance. Get the Right Professional Team Investing in real estate is a big undertaking, and you need to be sure of every decision you make. The right team on your side will give you sound professional advice to help you avoid mishaps and pitfalls. Your team should include a real estate lawyer and a reputable rental management company. These professionals should be able to explain the details of your purchase and management process using simple language, not jargon that leaves you confused, so you can navigate rental property investment with confidence. Have Money Reserved A final issue to consider is the possibility of having a vacant property for an extended period of time – for whatever reason. This will negatively affect cash flow and impact your profitability if there is no cash set aside to mitigate it. Owning a rental property in a location where the real estate market is good and has a strong economy, such as in Rochester, NY, is the first step towards succeeding in the property investment business. In addition, you can get a great deal and reach your goals by working with a team of experts, such as rental management professionals, who know the ins and outs of the local market. Author Plate Danny Torres is from Torres Turn Key, a property management company in Rochester NY with more than ten years’ experience dealing with both domestic and international investors. Providing a holistic service for the rental management of both commercial and residential properties, the company brings together a host of experience and specialist knowledge to build long-term relationships and create maximum value and benefit for their customers.
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