Investment properties are purchased with the intention of making an eventual profit on the property. According to Business Insider, the top 10 cities to buy investment properties in 2017 are: Atlanta, Orlando, Seattle, Las Vegas, Chicago, San Diego, Oakland, Detroit, Dallas and Memphis. There are many different factors that make a city a good place to purchase an investment property, this ranges from economic expansion to having a high renting presence.
A big benefit of investment properties is there are multiple pools of renters. There are long-term renters that are looking for a property to reside in for a little while, and there are vacationers who rent for a week or two. If you do decide to rent out your property to vacationers, you could always take a vacation for yourself when your property is not rented for the week!
Financially, if you can acquire a property at a low interest rate, you will most likely have a good return on investment over time. Having lower interest rates on a property allows property owners to generate more income from renters, which enables them to pay off the property faster.
How about the cons?
Renting a property to others also has its downside. Becoming a landlord to tenants can easily become more work than expected. Major issues that arise on the property becomes the landlord’s problem, not the tenants. If something goes wrong with the plumbing or heating, expect a call. Depending on the tenant, you may be bothered for smaller issues, such as changing a lightbulb. Also, keep in mind if you decide to rent your property to vacationers, you are going to have to hire a cleaning staff to clean after each stay or clean yourself. Either way, be sure to include some type of fee to cover the cost of the cleaning crew or for your own personal cleaning supply expenses so you’re able to clean the property after vacationers leave.
Just like anything else, there are many benefits and drawbacks of acquiring an investment property. If you’re debating whether an investment property is right for you and want to look into interest rates, get in contact with one of our loan officers at 1-844-77vLoan or get your free rate quote today! Don’t do mortgages like your parents did. Do it digitally, with vLoan.