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So, you’ve decided to become a property investor-slash-landlord? Congratulations! Purchasing a house or apartment and renting it out for profit can be a very lucrative endeavour – but, as always, it’s a case of “buyer beware”, because not everything makes a good rental. For a brand-new investor, partnering with a professional before you make any major decisions is a very wise idea. Because even after you’ve decided on a city, a local rental property manager is the best person to tell you which neighborhoods are going to be easier (and more lucrative) to rent out. Location This is an obvious one, because the neighborhood in which you purchase will determine the demographic of tenant the property will attract. For example, if you buy in an area in the close vicinity of a university, there’ll be a lot of student renters, and if you buy near a school, you’ll appeal to families. You need to consider not just things like schools, but other infrastructure as well, like parks, sports facilities, public transport, and more. Crime Levels Everyone wants to feel safe in their own home, even if it’s a rented one. Your rental property manager will have access to checks to see criminal activity in a particular area – including vandalism, break and enters and more serious crimes. There’s no point buying a high-quality home in a neighborhood where a tenant would not feel safe. Local Employment Opportunities This is a very important factor if you haven’t yet chosen the city in which you want to invest. It’s vital to invest in a city with good current and prospective employment opportunities, so people want to move there to live and work. Somewhere with good prospects in multiple industries will attract more potential renters, and a good rental property manager will have insider information on future local developments and their ramifications on the housing market. Vacancy Rates and Average Rents Again, this is where having a rental property manager before you purchase comes in very handy. If the vacancy rates in an area are particularly high, it’s a clear indication of lack of demand. A vacant property is the bane of a landlord’s life and there’s no point investing in an area that already has lots of empty rentals. The second part of this point is knowing the average rents that are being achieved in the area. If it’s less that you need for the investment to make a profit after all your costs are covered (including mortgage, taxes, maintenance and fees), then it’s not a viable investment for you. The Real Estate Market Finally, you should try to get a general sense of the real estate market in the area you’re considering. If properties are sitting on the market for a long time, or values have dropped over a period, it might not be a wise place to make an investment. All these questions and more can be answered by a good rental property manager as you begin your search for the perfect house or apartment. Research, research, research, before you make any decisions, and you’ll have the best chance of being a successful landlord and securing your financial future. 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 both commercial and residential properties, when you’re looking for a rental property manager in Rochester, NY, Torres Turn Key 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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