Look at your life now: is it what you expected? Are you using your degree to make an amazing salary or are your still scraping by in life? Are you making enough money to payoff your debts?
Have you thought about an investment property?
Sure you have! The question of how to get started is lingering in the back of your mind but you may have left it on the back burner. You may think the reality of having an investment property sounds far fetched, but it’s more of a tangible reality than you may expect. Be the landlord!
Currently, interest rates are still low for mortgages. Rental rates are high. Having this combination works in the favor of all landlords. Now is the time to get involved in the rental property sector.
Navigating your way through the rental sector can sound intimidating, but it shouldn’t be. We’ve gathered the initial steps to take to begin diversifying your income stream to include a rental property (or even properties!)
1. Research Where
Think about where you would like to purchase a rental property taking into consideration the demographic of people that live in the area, the schools, and industries near it. Look at the types of rental properties in the area thinking about the kind of money people in the area bring in as well. Now compare this with the average selling price of the area. This will give you an indication of whether investing in the area would be profitable for you. Remember, profit is your goal. Think about the level of profit you’d like from the property while keeping in mind that you’ll be required to pay taxes and maintenance throughout ownership of the property. You will also be responsible for the utilities until you have renters.
2. Investigate Financing Options
Before you get your heart set on a specific property, look at what financing options you may have. When looking at financing options for investors versus homeowners, alternate options may be available. There are options of all cash, a mortgage, portfolio lenders, FHA loans, and many others. Speak to a loan officer to determine the best option to fit your needs.
3. Look at Specific Properties
Now that you know what you are looking for and how you can afford which, begin searching for your a rental property. Have a clear idea of the kind of property that you are looking for; what elements should it have and what kind of budget will you have for upgrades?
When all of your specifications are met, make an offer. Stick to your limit; this is an investment but not meant to stretch your budget either. Feel comfortable to walk away if things don’t mesh well and the pressure is wrong.
After the offer has been accepted, hire a inspector to ensure that things are set in place regarding the property. Make any updates needed to pass regulations.
5. Find Renters
After you receive the keys, now the real fun begins: find a tenant. More on that in blogs to come!
As you’ve read through the steps of becoming a landlord, our hope is that you will find the process smooth with plenty of help along the way to diversity your income in a rewarding way.
All my best,
Picket Fence Properties, located in Windsor, CO is Northern Colorado’s Top Notch Property Management company helping owners with their rentals, income/investment properties and vacancies in Northern Colorado. Are you a owner of a home for rent or that you’d like us to manage? We help you have the perfect tenants in NoCO. Are you looking for somewhere to rent in Greeley, Loveland, Fort Collins, Wellington, Eaton, Evans, Windsor, Frederick, Firestone? Look no further, we have all your real estate and rental needs covered. Check out website for vacancies today.