Location, Condition, Price: The Top Three Features Of A Good Rental House
March 23 2016 Posted by Guriqbal Chahal, MBA, PMP
When you are shopping for an investment property you should make some of the same assessment criteria important that you would use if you were buying the property for yourself. A nice home in a good location will usually be safer, cleaner, and have better access to amenities. This will make the home more comfortable, pleasant and attractive to long term tenants.
Use a buyer’s checklist for curb appeal. If the current homeowner is not maintaining the exterior of the house in an attractive manner then it is likely that there will be problems with repairs prior to renting out the home. When you drive into the neighborhood are there signs of neglect for the neighborhood overall? If you see garbage in the streets and yards, graffiti on fences, walls or utility boxes, abandoned shopping carts, too many cars parked on the streets and untended homes, then it is likely that the neighborhood is in decay. The price of a house in this area is likely to be less expensive and you may even find a home in good repair, but you are placing your investment at risk in such neighborhoods.
Check the curb appeal! It’s important for buyers but equally important to attract long term tenants. Look for signs of fresh maintenance. The yard should be mowed, the bushes trimmed and in good health, the branches of trees cut back and cared for. The house exterior should be clean or freshly painted without peeling paint or obvious signs of problems. The roof should look flat and fairly new. The gutters should have leaf covers and downspouts with drainage directing pads at the bottom. Fencing should be intact and in good condition. Don’t forget the house inspection! This is your investment property that will bring you income for years to come.
The biggest mistake made by investors is not allowing enough time to find a good rental home. Spend time in the neighborhoods you are most interested in purchasing an investment property and walk around. When you walk several blocks in each direction you will develop a clear picture of the neighborhood, and you will experience the area in real time. See if people living in the neighborhood are your target rental market, students, families, etc. Can you walk to stores, transit, shopping, activities, theaters, parks, hiking trails and other areas? Pay close attention to any signs of problems in the area and talk to your real estate rental agent about issues that may not be readily visible. When you find the right house in the right neighborhood, purchasing an investment property can be an attractive option.