Owning a rental property can be an intimidating and expensive job. However, you can buy your first Kalamazoo rental property in a short time with a systematic approach. Having a rental income to supplement your income can be valuable to you reaching your life goals. Below are the key parts to finding and purchasing your first rental property.
Collect as much information as possible regarding the place you intend to invest in. Search for key area features that might bring in renters, such as a park, shopping, access to public transit, or a lovely view. Moreover, you need to learn about the tax laws and mortgage rates to give you a solid estimate as to how much you should budget for your future investment and cash needed as down payment and mortgage costs for your first Kalamazoo rental property.
When planning to finance, there are various types of options you can utilize. Rental property loans or finance options might differ from those mortgages offered for owner-occupied properties. Here are some different financing option types you could consider:
- 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 research to make certain the loan fits your budget and needs.
- Portfolio lenders – get hold of an adapted portfolio of mortgages available with flexible terms specific to property owners.
- Federal Housing Administration (FHA) loans – while FHA loans are intended for those planning to reside on the property, there are a number of options available that permit FHA-financed homes to have more than 1 unit (maximum of 4). Using FHA, you could have a rental property unit while staying on the property also.
- 203K loans – this loan considers the cost of home repairs and improvements into the loan amount. This can be valuable when looking to renovate a property and rent it out.
Find a Property
Partner with a local real estate agent to know where there are properties available in your targeted area. Have an overall idea of the specifications of the property and how much you are ready to spend. Make certain to set expectations and limits when property hunting. If you get the right purchasing point, you can then determine your long-term profitability.
An essential step in the process not to be missed is to have a property assessment of the property to determine if it is livable as well as what needs to be repaired or changed to make the home rent ready. Prior to buying, you can ask a Real Property Management office to evaluate the rental property to give insight regarding its rentability and to give suggestions for upgrades and so on. Also, they can recommend an expert home and pest inspector if needed. In this crucial step, you will be able to get an estimate regarding the property’s current and potential performance.
Do you want a free assessment of your potential rental property? Please contact Real Property Management Investment Solutions today by filling out the form online or calling us directly at 616-419-8880.
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.