Owning a rental property can be costly and intimidating. But, you can purchase your first Friendswood rental property in a short time with a calculated approach. Having a rental income to boost your income can be beneficial to you achieving your life goals. Below are the primary elements for locating and buying your first rental property.
Research
Collect as much information as you can about the area you plan to invest in. Look for standout features of the area that might attract tenants, such as shopping, a park, access to public transit, or a great view. You also need to read up on tax laws and mortgage rates to give you a reliable estimate as to how much you should budget for your future investment as well as cash required as down payment and mortgage costs for your first Friendswood rental property.
Finance
There are various different options you can make use of when looking to finance. Rental property loans or finance options may be different from those available to owner-occupied home mortgages. Below are some different types of financing options you can try:
- Cash – use cash to acquire a rental home.
- Mortgage – pay a down payment and then monthly mortgage payments.
Note: there are many types of mortgages; do your homework to make sure the loan matches your finances and needs. - Portfolio lenders – access an adapted portfolio of mortgages available with flexible terms exclusive to homeowners.
- Federal Housing Administration (FHA) loans – although FHA loans are meant for those planning to reside on the property, there are some options available with FHA that permit FHA-financed homes to have more than 1 unit (up to 4). You could live on the property while also having a rental property unit using FHA.
- 203K loans – this loan factors in the cost of home improvements and repairs into the loan amount. This can be helpful when looking to renovate and rent a property out.
Find a Property
Connect with a local real estate agent to find out where there are available properties in your targeted place. Have an overall idea of the property’s specifications and how much you are prepared to spend. Make sure to have limits and expectations when property hunting. Once you find the best purchasing point, you can figure out your long-term profitability.
Property Assessment
A key step not to be missed in the process is to have a property assessment of the location to figure out if it is habitable and what requires replacement or repair to make the property rent ready. Before buying, you can request for a Real Property Management office to assess the property to provide advice concerning its rentability and to give suggestions for upgrades and so on. Also, they can recommend an expert home and pest inspector if needed. Within this crucial step, you can find an estimate for the property’s current performance and potential performance.
Do you want a free assessment of your potential rental property in Friendswood? Please contact Real Property Management Prestige today by filling out the form online or by calling us directly at 281-532-5455.
We are pledged to the letter and spirit of U.S. policy for the achievement of equal housing opportunity throughout the Nation. See Equal Housing Opportunity Statement for more information.
