How to Get Started: Buying Investment Property
The first and most important thing I tell EVERY new investor when buying investment property is this: “Don’t fall in love with the house!” The biggest mistake I’ve seen new investors do is over-improve a rental property. Stick to the theme KISS….Keep It Simple Stupid! When you need to replace the bath faucet, go to the Home Depot and buy the faucet that is on clearance! When you are buying kitchen cabinets, buy investor grade cabinets, no fancy designs, hinges, shelves or colors! Go just with basic investor grade cabinets (Mills Pride is a good brand to look for).
Now that we have agreed you will not have an emotional tie to any house, the next most important thing is to do your research on WHO you are buying the house from. What gives them credibility? What resources and contacts can they offer you besides the house? Do they have an office? I would think twice before signing a purchase contract on the hood of someone’s car! Check the Better Business Bureau, call the local Association of Realtors (the Tampa Association is www.gtar.org). Also research their name and company on the Florida Department of Business and Professional Regulation site https://www.myfloridalicense.com.
Once you have found someone you trust, I recommend looking at some of their recent sales. This takes the pressure off you when buying investment property. You will get familiar with what you are looking at and be prepared to look at some of the other current available Investment Properties they have. This will also help you find some of your preferences like: neighborhood, school zones, house size, construction, MFU vs. SFR (Multi Family Urban vs Single Family Residence).
The next hurdle is stepping up to the plate and BUYING a house! A lot of new investors struggle to pull the trigger on their first investment. Don’t worry, you’re normal! We are all nervous the first time we buy a beat up investment property. That’s the primary reason we can buy them at such great prices: most buyers are turned away by a house that looks and smells like a trash can! But I can tell you from my own experience and the experience of my associates at Realnet, we never regretted pulling the trigger! Not only are the houses we sell at great prices, but you will gain a library of knowledge on your first house that will make all your future investments even more profitable!