What makes a profitable and successful Roseville rental home? We have identified five things that are sure to tell you you’re making a killer investment.
Here’s what to look for.
1. Rental Property Location
Location is perhaps the most important factor in determining whether a rental property will be a successful investment. You need to make a careful study of this before you buy because you cannot change a property’s location after you have closed the deal.
Check out the neighborhood and get an idea of what your tenant population will be like. Tenants interested in a low-maintenance apartment unit will likely have different priorities than those looking for a large single-family home with a big yard. Check the school systems and make sure things like shopping, restaurants, recreation, and commuter routes are close by.
2. Good Property Condition
Always have a home inspected before you buy it. Consider the structure and foundation. Look for weaknesses that may surprise you later. Don’t worry so much about cosmetic issues; bad wallpaper can be taken down and old shag carpet can be easily replaced. You want to make sure the property is not going to be a habitability issue now or in the future.
You also want the home to be in a condition that makes it move-in ready almost right away. Don’t waste a lot of time and resources rehabbing the entire home before you’re able to get it on the market. A profitable rental home is going to be ready to list in a week or two after acquiring it.
3. Modern Upgrades and Updates
You don’t want to invest in a property that’s going to require a lot of work. However, you must be willing to make a few cost-effective upgrades and updates if they’re needed. Paint the walls and clean or replace the carpets. If the appliances are old, replace them. Pay attention to the landscaping and the exterior of the house. You’ll need some curb appeal if you want to attract highly qualified tenants and leverage your rental income.
4. High Rental Values
What you earn every month is an important indicator of whether a rental property is profitable and successful. It’s often hard to earn positive cash flow soon after you invest. However, you should be earning enough rental income that the investment makes sense in your portfolio. The rent you earn should contribute to mortgage payments as well as maintenance, taxes, and insurance.
Invest in homes that can earn what you expect them to. Rental values impact your short-term earnings and your long-term ROI as well.
5. High Property Values
Appreciation is going to depend on your property value. In the current market, home values are shifting and it can be difficult to know what to expect in terms of how much equity you’ll be able to earn in the first year or the first five years. Profitable rental homes increase in value, and part of that is up to you. You’ll need to be proactive with maintenance and protect the condition of your investment.
There’s a lot that goes into creating and maintaining a profitable and successful rental property. As Roseville property managers, we have systems in place to ensure your rental homes are working for you from Day One. If you’d like to learn more, please contact us at Action Properties. We work in Roseville, Rocklin, Loomis, Lincoln, Granite Bay, and the surrounding areas.