When you are shopping around for rental investment property you should keep in mind that just because you find a good price, it doesn’t mean it will make a great rental property. There are simply some properties that are suitable for renting than others. This can be one of the most common mistakes many people make when they purchase their first rental property. By understanding which properties should be avoided, or at least how to handle problem properties, you can be more confident of your success.
Outdated homes are a prime example of properties that are not the best properties. One of the main reasons that outdated homes do not often make good rental properties is the fact that they are simply more prone to have things go wrong with them. In some cases, this can turn out to be quite expensive. You will have two choices when dealing with an outdated rental property, you can either spend the money to update it and risk your profit or you can decide not to update. The latter is also quite risky as more renters, if they have a choice, will rent a property that is updated. Renters typically expect the properties they are renting to be safe, secure and have working systems and appliances. Some of the main problems you may run into with outdated properties include plumbing issues, roof leaks, cracks and settling issues, electrical problems and the ability to obtain parts for appliances.
Outdated homes are not only frustrating because they tend to have systems and appliances that break down, but they can obviously be expensive in many regards. Not only will you have to pay for the repairs but more often than not the repairs will need to be made when you least expect it and during the least convenient time; usually translating into an even higher cost.
Homes with pools don’t work as rentals. At first, you may see a home with a pool as an advantage, which would be appealing to prospective tenants; however, this is not always the case. Many prospective tenants, especially if they have young children, do not want to live in a home with a pool because of the risk factor. You should also take into consideration the issue of liability as well as the cost of maintaining the pool.
In addition, homes that are considered to be high-maintenance may not make the best rental properties. Consider how much time you are willing to spend each week working on your own home, if you are a homeowner. You might find the tasks of weeding, mowing the lawn and watering the flowers at least fulfilling if not rewarding. The thing about tenants, they are often not willing to perform these tasks for a home they don’t own. If you have a property that requires all of these tasks, consider hiring someone to handle the yard work and then include the price in the rent. You will be able to guarantee that the work is done and your property does not look unkempt without having to actually worry about it yourself.
Location is always important when it comes to real estate and that is no different when choosing a rental property. Properties, which are close to amenities such as shopping and schools and are generally considered to be in a good neighborhood will typically make better rentals than homes that are located on busy streets or which are not near these amenities. Therefore, it is always important to make sure you take location into consideration when choosing a rental property because most prospective tenants will be looking for properties that are in a great location. If there is competition in the market, a tenant will often choose a rental that is in a better location even if it means paying a bit more in rent.