To invest or not to invest, that is the question! An investment in real estate, if done responsibly, can significantly build your financial portfolio. It can be difficult to know where to start, but once you dive in, the return on investment can be quite lucrative, with benefits including:
- Extra monthly income
- Increased wealth as the property value goes up
- Portfolio diversification
- Rent to help cover the mortgage
- A guaranteed vacation spot when a rental is empty
Interested in investing? Here are some tips to help you make the most out of your investment properties:
1. Choose the Right Location
Pick a location that has a positive impact on the home’s value. A low crime rate, a great nearby shopping center, distance from schools, and other entertainment venues or attractions are a couple of things that can make a location more attractive.
2. Pick a Higher Down Payment
An investment property will require a higher down payment, about 20-30%, if they’re not owner-occupied.
3. Insure the Property
As an investment property owner, you will want to cover any damage or incidents that could occur. Rental property insurance or landlord insurance will cover property damage and lost rental income while protecting against potential liability issues. As for vacation rentals, a business owner’s policy is more popular for these types of investment properties.
4. Check Regulations for Vacation Rentals
If you would like to use a service such as AirBnB or VRBO, be sure to check your local laws prior to listing your rental on any site.
Still have questions or unsure if property investment is right for you? Feel free to contact me at 480-355-8645 and I’d be happy to help!