At first glance, the idea of investing in property would appear to be the opposite of the much trendier way of making money nowadays, that is all online... however, when you compare the two methods of making an income there are some huge similarities; in both instances you are building an asset, reinvesting in that asset, and then leveraging the asset to create passive income.
It’s wise for people to diversify their income strategy and one way is to incorporate a more traditional asset such as investing in property.
This article offers some general inspiration for people dipping their toe into the idea of buying an investment property. It’ll help you think about where to find a property and what to buy.
WHERE TO BUY
Many amateur property investors choose to head to an auction, thinking this will be the best place to grab a deal, and to an extent they are right - however, there’s often a reason why the property is being sold at auction rather than by a realtor. If it’s as simple as a financial issue where the bank has foreclosed on the house and their corporate policy is to always sell at auction - that’s fine - but think of buying a car at an auction, often times, sellers will put their car through auction knowing it has some hidden faults or damage that you might not spot on a quick once over in the auction room.
Furthermore, it’s very easy to get caught up in the psychology of the situation at an auction, where you can spend a lot more than you were planning to on the basis of the competitive and almost hypnotic spiralling of the price as you battle to “win” the in-demand property. A better option, particularly if you are a newbie is to find sellers directly and negotiate with them direct. They can sometimes be a bit trickier to find than going to an estate agent that will offer a brochure, set up appointments, and so on - but in this internet age, it’s very possible to find people willing to sell their homes direct.
WHAT TO BUY
In many ways, what you buy is contingent on having the right finances in place. You may wish to check out homeequitylineof.credit for some inspiration with regard to that. Presuming you have access to funds, this is where things become quite good fun.
There are several factors to consider that will require significant research; such as whether the area is up and coming or if it’s going downhill fast; aspects to consider include crime rate, the quality and proximity of local schools, transport links, and social amenities.
If you can get your hands on some insider insight, such as from the local council, and find out a major transport hub or large business park is going to be built in the next five years - that would be an obvious positive, however, if you were to find out a new sewage treatment was opening up in a few years time it would be a different story. The point is, do your homework, as whilst it might feel onerous and perhaps even costly - it will pay off in the long run.
For a free checklsit on buying a rental property you might want to check out this link: http://www.alpinepdx.com/pdf/Checklist-Buying-RentalProp.pdf