When you’re a property virgin, buying a home may seem a bit overwhelming and honestly, the first go-around can be a little nerve wrecking. But for most, once you’ve done it, you’re comfortable enough with the process to do it again. Investing in property can be a slightly different story.
Your goals are different when you’re searching for possible investment homes. You want to earn money. But you to do that, you have to buy the right properties. If you’re looking to flip properties, your goal is to find homes that once renovated, sell fast! If you want to buy and hold, you’re looking for properties that are close to turnkey (for tenants) and are a good value for the market. In either case, you don’t want a property that’s a money pit.
Here are 3 quick tips to help you find the right first investment property
Use a Realtor
There are property listings everywhere – from Craigslist to those yellow street signs you see everywhere. Sure there are plenty of options for you but that doesn’t mean that they’re all legit. You want to make sure that have proper representation during any real estate transaction (and the seller should too).
Choose a realtor that specializes in investment deals. But even then you’ll need to be specific in the type of purchase you are looking to make. You want someone that understands what you’re looking for and what you want to do with the property. For example, a realtor that is well versed in facilitating rental property transactions may not be as familiar with wholesale property purchases.
Tip: Do your own due diligence. Check out sites like realtor.com and T.J Lamb Real Estate to start understanding what’s available on the market and what medium home values are for your target area. Your realtor may be the expert, but you want to go into all transactions knowledgeable and informed.
Think like a buyer
Take yourself and your preferences out of the equation. To make money in real estate you have to think like your potential buyers and or tenants. You may be a professional single female that prefers low yard maintenance and an open floor plan… that won’t matter if the market is currently full of young couples looking for a home with a large yard and defined spaces to start a family in.
Tip: The more you know your target buyer/tenant, the better. Research current real estate trends – from wall colors to preferred floorplans. You want your property to speak to them so that they are quick to say yes! And you can move on to the next transaction.
Never skip property inspections or surveys
No matter how good the deal appears to be, always complete a survey on the property (aka complete and thorough home inspection). Always. Even if you’re not expecting the current seller to make improvements, you want to know as much as you can about the property before you buy it. This will help you avoid costly repairs that have the potential to turn your investment into a nightmare.
Tip: When you find a good home inspector, stick with them. You want to build a strong list of dependable and quality contractors. Make finding the best home inspector a top priority.