Key Tips For Buying Your First Investment Property
Posted on: 20 January 2022
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Buying investment properties can be a great way to make money. But jumping in and buying your first property can feel a little risky. You'll want to take your time with this first purchase and be open to learning along the way. Here are a few tips to follow in order to increase your chances of making a successful investment.
Hire a real estate agent
A lot of real estate investors reach a point at which they know so much about buying and selling homes that they don't necessarily need to hire an agent anymore. But as someone who is buying their first investment property, you're not there yet. Hire an agent — even if you only do so the first time around. A real estate agent can help you negotiate. They can coordinate with the bank and your real estate attorney, and they can help you find properties that you may otherwise overlook.
Search close to your home
Owning investment property can be more time-consuming than you assume, especially if you need to update the property. Driving a half hour or more to the house every day, just to work on it for a couple of hours, will become a burden really quickly. So, for your first investment property, really focus on looking at homes that are close to your own residence. You'll save so much time and gas money that you can instead invest in the home.
Consider minor fix-ups, only
You may eventually reach the point where you're confident buying and fixing up homes with leaky foundations or deteriorating roofs. But for your first investment property, you want to avoid homes that are this hard to fix up. With these homes in really bad shape, there's always a chance you won't be able to fix it and will have to take a loss instead. If you buy a home that needs more minor improvements, such as a kitchen update and new floors, you'll be taking on much less risk. It's worth buying a lower-risk investment home this time around so you can get some guaranteed income to invest in additional homes later on.
Buying investment properties can be a good way to boost your income and save for the future. Just make sure you ease your way into it. Investors who take things one step at a time and follow the tips above are more likely to succeed.