Real estate investing is one of the most tried and true investments of all time. Even today, millionaires say it's the best investment around!
However, for a new investor, there can be an overwhelming amount of information out there. Here are some real estate tips for beginners to help you get the most out of your investment property!
1. Buy the Right Property
Your property is the most impactful decision of your real estate investment. If the neighborhood goes downhill or the property has too many issues, you can lose money. These are widely out of your control after purchase, so some initial research is essential.
You should only buy real estate in an area that's relatively safe. Think of easy access to public transportation, schools, or other permanent amenities. These are much safer than popular bars or restaurants, which can come and go!
Also, newer properties tend to last the longest. Unless you have the funds for rehab, a turnkey property is typically the safest option.
2. Draft the Right Lease Agreement
Your lease agreement needs to be airtight for your protection. If tenants have something to exploit, they just may, and you'll be left to front the bill for it. Always consult with professionals and draft the right agreement to ensure your long-term security!
Moreover, this should include tenant behavioral policies, rent policies, possible rent increases, security deposits, and more.
3. Choose the Right Tenants
Tenant screening is a must. At the minimum, you need income verification and rental history. However, credit checks and background checks can also help you find the right tenants.
Make sure you're marketing your property on the right platforms and making expectations clear at the beginning. This will help weed out potentially harmful candidates from applying.
From there, always ask for references and ensure that prospective tenants have at least 3x the rent in monthly income. Four times is ideal, but triple is the minimum.
Remember, the property and neighborhood are only two pieces of the puzzle. Your tenants can easily cost you thousands of dollars if you aren't careful.
4. Get the Right Help
With the help of the right property management services, you can have access to industry professionals who can take everything off of your plate. That's right, everything.
For only a small portion of your rental income, they can help market your property, thoroughly screen your applicants, maintain the property, collect rent, and so much more. From there, you can just sit back and watch the checks come in while you enjoy traveling, retirement, or just living your life! There's no better way to enjoy passive income!
Start Your Real Estate Investing Journey
Now that you know some basic real estate investing tips, put them to use right away. Real estate is one of the best investment opportunities in the world, so get the most out of your investment!
Stay up to date with our latest real estate tips, and don't hesitate to contact us with any questions or for help with your property!