Providing the best (and most profitable) rental homes in Fairfax means starting with excellent properties! When growing your real estate investment portfolio to deliver more great spaces to renters, investors must learn how to identify good properties—or risk losing money.
What should investors look for in a good investment property? Check out these insights from our expert Fairfax property management team!
However, buying a property that looks nice isn’t always the best indication of a profitable investment. “Nice” properties can be in terrible locations or have underlying issues that become a liability rather than an income-generating asset for investors.
An In-Demand Location
Buying your next rental property is similar to buying your first property! It’s critical to analyze every new investment property before finalizing a purchase.
As tempting as it might be to invest in a newly renovated property that has everything a renter could want, if it’s not in an ideal location, you could be setting yourself up for a significant financial loss. When considering a new investment, analyze the location and make sure it attracts quality renters.
Check school ratings, walkability, and access to transportation and entertainment when evaluating the location of a potential rental. The best Fairfax rental home in a rundown neighborhood or an area that doesn’t have excellent access to restaurants, shopping, highways, or retail might stay empty for weeks or months until you find a renter willing to live in a less-than-desirable location.
Excellent ROI
A great rental home in an excellent location won’t be a good property for you if it can’t generate the right ROI. Before closing on a new property that seems like a good investment, be sure to run the numbers!
The best Fairfax property management company helps investors analyze the profitability of a potential property. We have the right experience and research to:
- Analyze rental market analysis
- Compare a potential property to similar rentals in the area
- Estimate the monthly rental rate to make sure a property can compete
- Research potential ongoing costs and compare them against the potential monthly income
If the numbers point to an excellent long-term ROI, you’re probably looking at a good property! However, if the numbers don’t add up to a profit, it’s best to move on to another property— even if it seems like it’s an investment opportunity that’s too good to pass up.
Reasonable Renovations
A complete fixer-upper could blow your budget before you get the home on the rental market. While most new rental properties need a few updates before becoming rental-ready, if a property needs to be gutted and overhauled, you might be investing in a money pit.
Look for a new investment property that won’t require a significant amount of work or money to attract quality Fairfax renters with the amenities they want in a rental home. One of the best ways to start generating a profit from a new property is to get it on the market as quickly as you can without costly upgrades that hurt your profits before you begin collecting monthly rental income.
If you’re considering a property that seems like a good deal because the price is low, make sure you consult a Fairfax property management company to review necessary renovations and estimate potential upgrade costs. The right property manager can help you factor these expenses into the potential profitability of a property or help you decide an investment isn’t the right fit for your long-term income plans.
Insurance Coverage
Every investment property needs the right landlord insurance policies to protect the rental home and your income. Is there anything about the property that might cause an insurance company to deny coverage? From high crime areas and potential natural disasters, the location or condition of a property can affect the type of coverage you can get and how much you pay for it.
Get estimates on potential policies and make sure they are the right fit for your Fairfax property and fit your budget. Work with a Fairfax property management company to make sure you research the right coverage for your new investment.
Appreciation and Deductions
In addition to rental income, real estate investors benefit from property appreciation and tax deductions. When analyzing potential profits, make sure to research potential appreciation and tax benefits for a property. If these numbers add to a positive long-term ROI outlook, a property can be ideal for your next purchase!
A Fairfax Property Management Company Helps Maximize Income From a New Property!
When you find an excellent new investment property, maximize the income from it with the best Fairfax property management company! RentSimple not only helps investors analyze potential rentals to make sure they’re a good investment, but we also manage them for maximum profitability.
With our services, real estate investors enjoy worry-free management and passive income. Before purchasing your first (or next) property, contact us to run the number for you and handle every management detail!
