You’ve decided to become an owner of a new property and hope to rent it, great! While you have made the decision, you still need to purchase a good rental property. But what is a good rental property? Everyone has a different definition and outlook, but typically, great rental properties have the ability to profit off of rent.
Housing Market News – Ways to Determine A Good Rental Property
The One Percent Rule
This rule may sound weird, but it works great when trying to look for a good rental property! In order to make a profit or earn back the money from buying the property, use the one percent rule! The one percent rule is the amount of money you can charge your client and renter based off of the value of the home.
According to affordanything.com, “A $100,000 property should rent for at least $1,000 per month “, in order to be considered. This way if there are any changes in the housing market or your property value, you will be covered.
Survey The Area The Property is In
The area and location the rental property is in should play a large roll in your choice to buy or leave the property. Cities that are close to a college or university are great choices for rental property purchases. There is a constant need for properties for rent in these areas because of the demographic. Students are always in need of a home, and with competitive pricing, it works great for the buyer!
Pay Attention To all Fees and Closing Costs
An easy thing to forget when purchasing a new home or property, are all of the closing costs and hidden fees within the contract. Beware of these hidden fees as they may not be worth all of the trouble. Be sure to check out to thoroughly check out the property including components that can be expensive to fix, such as; Air conditioning, Electricity, power outlets, and more.
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