Some of the most important factors to consider with real estate investing
For many people, their first investment-minded piece of real estate is a big deal for them. They get very excited when they make the decision that they are going to own a property, and they get similarly excited when they start looking at the different properties they want to buy. It is a special purchase, a special property and a special investment, and it is important that you consider a number of important factors when making the decision on which one to buy. Some of these factors are common sense, while others are things you may never have considered.
The first thing to consider when looking for your first investment property is whether or not you like the property. Obviously, you shouldn’t make your purchase based solely on instinct, or solely on whether you like it or not. At the end of the day it is an investment property, and the most important thing is the fact that it provides a high return on that investment. But it will still be a special property for you, as it is your first, so it is important that you take the time to try it out and make sure that it is also a property that you really like.
The most important factor to consider when choosing your first property is the property’s location and neighborhood. Nothing will influence the success of your investment more than the location in which it is located. A great location will make the whole process easier, while a terrible location will be problematic, to say the least. Chances are, if this is your first real estate investment, then you won’t have a lot of money to spend, so you may not be able to make a purchase in the highest quality neighborhoods. For your first property, you’ll want to find an affordable property in a neighborhood that is likely to increase markedly in value and quality in the coming years. Just because you can’t afford a property in the best location doesn’t mean you can’t afford a property that will grow into one over the life of your ownership.
Older properties sometimes qualify. Depending on the location and neighborhood, an older property can be really affordable. Certainly, there are historic properties that are in extremely affluent neighborhoods that are probably beyond the capital you can raise for your first purchase, but there are plenty of great older properties that are in good condition but are in lesser neighborhoods. While these properties generally require some level of repair, they are often affordable and in demand. More and more people these days are interested in moving into older historic buildings and fixing them up, and this is a trend that is likely to continue for some time. This means that there are many opportunities to buy one of these properties now and benefit from the higher interest and cost of them in the next two years.