Considering Investment Property? (title)
Are you thinking about buying residential property to lease? At Hawkins Realty, we know the neighborhoods where you can purchase this type of property and we understand the value of owning this type of real estate. We'll help you get the gears turning on income producing investment property. Let us help you find investment properties that create a stream of revenue and grow in value.
Here are some tips to consider if you are planning to manage residential properties for investment purposes:
1. There are plenty of tax advantages
Investing in residential real estate comes with numerous tax advantages. You can factor in deductions such as property depreciation, mortgage interest, the cost of repairs to the home.
As always, different people have different tax situations, so be sure to consult your tax professional regarding your personal financial picture.
2. You have a lot of control over your investment
You select the market to buy in, and are not pressured to buy it unless you are happy with the price. Next, you decide on the budget for renovations. You decide if you should hire a property manager. You and/or your property manager select tenants, and set the guidelines for leasing. You decide to hold or sell.
Obviously, not everything is guaranteed and roadblocks will come up, but this is a special asset class where you have a ton of control.
3. The value is in consistent monthly cash flow
Buy and Hold residential investing is beautiful once your property is performing. You mortgage payment goes out, rental income comes in, and hopefully it becomes clockwork on the 1st of every month.
*NOTE: always have cash reserves for when those pesky repair expenses come up*
4. Loan pay down
The amazing thing that some new investors fail to realize when looking at ROI, is the fact that when your property is occupied and cash flowing, your tenant is paying down your principal, interest, taxes, and insurance for you. It’s great! So, even if your property “breaks even” one month due to unexpected repairs or maintenance, you still have someone else paying a majority of your expenses. It is a great way to invest!
6. Look for creative financing options
Pay all cash or get a traditional mortgage? You may think those are the only two options available for buying residential real estate. Luckily, there is a diverse range of additional financing options. Seller financing, getting a loan from a self-directed IRA, private loans, master lease with option to buy … these are just a few creative ways to finance your next investment.
7. Location is So importantNumbers on paper are not everything. It is important to understand your location. That's where we can help! We know a lot about the growth and changes in this area south of Charlotte.
The last thing you want is to get an unqualified tenant because your property is in a bad neighborhood. We can help you invest in properties located where tenants will be able to afford the rent, and pay.