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What New Real Estate Investors Need to Know Before Jumping In


If you have never had a real estate investment property before it is a good idea to learn a little bit about them before getting started. The more you know before you start, the easier the process will be and the better you will be set up for your investment’s success.

How to Be Profitable

There are a lot of rules of thumb that can help you out if you are looking to make a profit with an investment property. According to RealWealth Network, one of the most common rules to keep in mind is that the monthly rent of a property should be at or above 1% of the total purchase price. This rule can protect your investment and ensure that you are making enough of a profit for your investment to be worth it. If a property couldn’t feasibly be rented for 1% or more per month, then it probably won’t be a worthwhile investment.

It’s Not So Passive

A lot of people go into real estate investing thinking that it will be passive income, sometimes though, it is a lot more like a part-time job. When you are renting out properties, you have a responsibility to take care of the properties, and that can take a lot of time and energy. According to Mila Realty, long vacancies can harm your investments financially. That means that in addition to making sure the property is in good shape you also have to ensure that you keep the properties rented out and are always working to keep things running.

How to Evaluate a Property

To get the most out of your real estate investment, you have to know how to evaluate an investment property. When deciding whether or not to purchase a property, according to Moving.com, there are several things you need to keep in mind. Some of the factors you should consider include the location, the kind of shape the property is in, and the size of the property. Rental properties in good locations with at least a few bedrooms tend to do better and are easier to rent out as you can fit many different kinds of renters in the space. 

Investment properties can be a great way to earn a little extra income if you are prepared. Considering the above things will help you to dive into the world of real estate investments.

Read this next: How to Break Into Real Estate Investing