Buying a Rental Property? These 4 Key Tips Will Ensure You Buy One That Turns a Profit
Updated: Nov 21, 2022
While many people may be hesitant to consider real estate as a viable long-term investment, owning property in the Northern Virginia market has a steady historical track record and isn't as volatile as other investment markets can be.
Any investor who hasn't seriously considered Northern Virginia real estate as an option should take a closer look at the benefits of owning residential property and why it is the ultimate long-term investment strategy.
Buy A Property With Year-Round Potential
Many real estate investors agree that the best rental properties are those that generate income every day of the year. The most straightforward situation to manage is one where you have stable, long-term tenants in place that aren't going to move or change often. Browse local Northern Virginia property listings around schools, colleges and large employers to see if there are any suitable homes for sale.
Once you gain experience and invest in other properties, consider branching out into vacation or short-term stay homes. But to get started, aim for stability.
Predict Your Income And Expenses
Next, you will want to craft a budget. Have a look through rental listings in your target communities to see what renters are currently paying. This will give you some idea of your potential rental income for a similar-sized home. You can then compare this to your estimated monthly mortgage payment, taxes, utility costs and repairs. It is impossible to predict precisely how much you will need, but this exercise can quickly prove whether this area is likely to be profitable.
Treat Your Rental Properties Like A Business
Since you have already taken the first steps with a budget, you might as well continue down the path to a full business structure. Most real estate investors set their portfolio up in an incorporated or limited-liability company, which reduces personal exposure. It can also be an efficient way to manage any legal issues that arise as your investments grow. Also, there will be significant tax advantages, including being able to write-off expenses such as repairs, contractor work and renovations.
Work With Experienced Professionals
Speaking of contractors, it's worth reminding to only work with experienced professionals who are licensed, certified and have references. Paying for quality work up-front ensures that you won't have to deal with hefty repair bills due to shoddy workmanship.
When you are ready to invest in rental properties, give PROMAX Management a call. Our professional real estate team is happy to share residential listings that are perfect for investment and rental income generation.
Promax Management, located in Northern Virginia, has years of experience working with investors and their portfolios. As investors themselves, they understand what kind of service you are looking for and establish standards for you to expect. They have the knowledge and experience to effectively manage your property and maximize your overall returns with swift and cost-effective solutions.
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