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Property Management Blog

Published on Saturday, November 29, 2008

Real Estate Investment Planning

If you are thinking of making any investment, then the best kind of investment today is real estate investment . However, before making investment in the properties you need to do a lot of market research, so that you can get the maximum advantage from your investment. The factors that you can consider, while you make any investment in properties are related to tax advantages, rate of returns and also future value of capital. These essential factors are quite important for any of your investment plans to succeed. So, just before taking any final decision, just think over your decision and think if your decision is or shall be the most profitable for you in the long run.

The first step in getting prepared for any kind of real estate investment is planning of your budget. You need to decide how much you can spend. Budget is dependant on many factors, such as reasons why you are investing, location you desire and specific characteristics of the property among other factors. Once you know why you are spending and how much you are spending, budgeting becomes easy. If you are looking for properties at the central place of a city, seeking facilities like easy commutation, magnificent views and all other facilities required for luxurious living, then be prepared to spend more. If you are thinking of making any kind of real estate investment , with a sole motive of selling it at a later stage, then make a thorough research on the future price and development of the region. Try to know the advantages and future prospects of the place, if it will develop in near future. You need to take the help of market analysts who will help you with the exact appreciated value that the property might fetch in near future. However, even while choosing your agent, be careful and select someone with experience in the business of properties. Your main aim shall be profit at the time of selling and all your actions should be keeping that in mind.

However, it has been observed that whatever may be the reason for your real estate investment, location plays an important role. If you are purchasing the property for your own stay, it is best to invest in a property that is centrally located, so that you incur minimum costs in commuting. If your home is located near educational instituitions or shopping centers, then you spend much less amounts in traveling to such places, especially important if you are a student. Besides being centrally and strategically located, the value of your real estate investment is bound to appreciate in near future. Thus location plays a major role in any kind of property investment. However, still there are many places which may not be so developed when you are thinking of making an investment, but you are aware of the future developments that can take place in the region. In such circumstances, your investment may be valuable and you can reap high values from the property.

The main point that should be remembered while you invest in properties is that you are in a profitable state. You should plan, budget and then make an investment. Do not forget to take into account the economic condition and political status of the place at the time of investment. These things play an important role in making your venture a success.

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Author: Web Master

Categories: Property Management




Landlord Knowledge Base

If you’ve ever considered investing in a few rental properties in Philadelphia or Bucks County, PA now might be a good time. Prices are still low in Philadelphia, but have been on the upswing. According to the National Association of Realtors, the median price of an existing home in a US metropolitan area grew 13.7% between July 2012 and July 2013, the latest in a 17-month streak of year-over-year price increases. 

New landlords can choose from properties that are likely to appreciate and a large pool of potential renters.Licensed realtor Pat Mueller cites a few reasons for this trend: “Many families have lost their homes to foreclosure and are entering the rentals market for the first time in years. Mortgages are also harder to get now, so fewer people are qualifying for a new one.”The more skills you bring to the table to get into Houses for Rent in Philadelphia Philadelphia or Bucks County, PA and the more time you have to devote to your properties, the faster you can make a return on your investment. 

But investing in rentals can also be disastrous (or too stressful to be worthwhile) without expertise. Here are three professionals you may consult about your new rental properties, and what you can do to mitigate how much they cost you:Handyman:  You may need to hire a specialist for some work on your rental. If you need new outlets or new pipes, for example, hire an electrician, plumber or licensed contractor. Handymen usually tackle smaller, more manageable tasks, like:

  • Painting and paint removal
  • Drywall repair
  • Minor appliance repairs (fixing a leaky toilet or faucet, among others)
  • Installing tiling or flooring, moldings, windows, doors
  • Refinishing decks, cabinets and other wood items

When You Could Skip It: You could do any (or all) of these projects yourself if you have the time and interest in learning. Of course, this only works if you live relatively close to your rentals and are flexible enough to service them on short notice. And if you’re willing to respond to the occasional 5 AM basement flooding.

Average Savings: Any base rates or costs-per-hour vary from location to location in Philadelphia or Bucks County, PA , but nationally, you can expect to spend an average of $60 to $85 per hour for repair costs. It general costs less to hire an individual handyman than a handyman employed by a company. Expect an additional charge if your job requires a trip to the store for materials.

Resident Property Manager As the owner of a handful of rental properties, you may be able to manage them yourself, but if you want help, a single resident manager would probably be more cost efficient than a property management company. Resident managers may:

  • Serve as a handyman
  • Advertise vacancies in your units
  • Show apartments to prospective tenants
  • Review rental applications
  • Collect rents

When You Could Skip It: Again, the closer you live to your properties and the more spare time you have, the less likely you are to need a manager. The obligations of being a boss will also cut into the time you save on maintenance.

Average Savings: The national median wage for residential managers is just over $25 per hour. Research the wages in your community and adjust according to how much responsibility your manager will take on. 

Real Estate Agent: Once you’ve gotten your financials in order and done your own research on the neighborhood(s) you’re considering, you might contact a realtor to show you potential properties. You can also arrange for a realtor in Philadelphia or Bucks County, PA to show rentals once they’re ready to rent.

When You Could Skip It: It depends. Even if you’re a local, or have thoroughly researched the neighborhood(s) you’re considering, a realtor is a great resource for a first-time rental buyer. Realtors have access to data and statistics not necessarily available to the general public and first-time buyers may not know all the right questions to ask. Using a realtor to fill your Houses for Rent vacancies is less of a no-brainer, depending on your other time commitments or whether you plan to hire a resident manager who could do the same thing.

Average Savings: As a buyer of rental properties, as when buying your own home, sellers typically pay most, if not all, of the buyer’s realtor fees. In this case, Mueller points out there’s little reason not to work with a realtor. For help in filling your units in Philadelphia or Bucks County, PA, the services of a realtor would set you back between 10-20% of the unit’s rent per month.  Mueller recommends interviewing with several brokers before making your final decision to invest into Houses for Rent .

The Bottom Line: As a new landlord, you can’t necessarily control the flexibility of your schedule or the amount (and cost) of unexpected repairs to your properties. Rentals are a long-term investment. However, to maximize profits from your Houses for Rent, new rentals, you can buy close to home and start small. It is best to begin with just one or two properties. This will allow you to maximize the time you spend on your properties’ needs, and minimize the amount you’ll have to pay anyone else.


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