Investing in real estate is a great way to build long-term wealth for you and future generations. If you’re thinking about buying an investment property, there are three points you need to consider before following through.
First, what’s your overall objective in buying an investment property? Most people buy them for one of four different reasons:
- They want an additional monthly cash flow.
- They want to buy a property in a very strong area that’s appreciating in value.
- They need a tax shelter for their income.
- They need something to do with their time and want one as a hobby.
Second, remember that becoming a landlord is a business, not a charity.Make sure you’re using the proper contracts and you’re following them. Tenants will definitely try to take every advantage they can if they see that you’re not running your investment property as a business. We have the proper contracts and forms and we’d be happy to supply them to you if you like.
Lastly, begin with the end in mind. What’s your overall purpose? Do you want to fix and flip and make a quick dollar on the sale or are you in a long-term, buy-and-hold strategy to create a cash flow for yourself? Worst case scenario, if something happened and you had to sell the property, how would you sell it and how would you dispose of it?
Stay tuned for part two in our series about investment properties. In the meantime, if you have any questions or are interested in buying an investment property, don’t hesitate to reach out to us. We’d love to help you get started!