Where to start when considering the purchase of an investment property


Where to start when considering the purchase of an investment property
By Scott Rogers • July 25, 2016
If you are considering the purchase of an investment property, I believe the first things you need to think about are.... BUDGET How much are you able or willing to spend on an investment property? This can be determined by your financing ability, or by the amount of cash you have to put into the purchase (for the down payment or closing costs), or simply by how much of an investment in a rental property you want to make at this time. INVESTMENT GOALS Are you planning to purchase and hold this property indefinitely? Or are you looking at a five year time horizon? Based on the amount of money you are putting into the transaction (compared to how much you are financing) are you hoping to break even on a monthly basis? Are you hoping to clear $X / month in positive cash flow? What are you hoping to get in return for your investment in the short term and long term? RISK TOLERANCE Relatively early on, you will need to decide how comfortable you are with risk, particularly because the more risk you take on, the more potential reward you have for taking that risk. The easiest way to think about this (in our local investment property market) is whether you are comfortable with buying student housing -- which comes with high rental income, but also the potential for more property damage and vacancy. If we gain some clarity on your budget, your investment goals and your risk tolerance, we can then narrow the scope on which properties it will make sense for you to consider as a potential investment property purchase. Receive Updates by Email Recent Articles: Is There A Price You WOULD Pay For This House? There Are Plenty Of Types Of Houses That Exist That Just Are Not Available To Purchase Home Sales By Price Range In The City Of Harrisonburg Are You Compromising On Aspects Of Your Next Home That You Can Or Cannot Change Later? How Much Slower Are The Winter Months In Our Local Housing Market? Rockingham County and New Home Sales Drive Surge in Area Housing Market Find The Balance Between Optimistic And Realistic Home Pricing Room Size Is Difficult To Understand Solely From Real Estate Photos How Much Would You Value Not Having To Prepare Your Home For Showings? One Out Of Four Homes Is Taking Longer Than A Month To Sell
Have any questions? Contact Scott Rogers at 540-578-0102 or scott@funkhousergroup.com
Based on information from the Harrisonburg-Rockingham Association of REALTORS® or its MLS, for the period Jan 1, 2000 through Nov 24, 2024 (unless otherwise noted).
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