Owning property is the American dream and one we all strive for. Although buying new property is an exciting time for an investor, it can also be quite challenging. Not only is it a huge financial commitment, but a time consuming one as well.
The process of finding a home is usually the most understood aspect of purchasing a property. When it comes to the close of escrow, however, people can get fairly lost. Most real estate agents are only interested in selling homes. If you’re looking to turn your property into an investment, a real estate agent won’t necessarily take into consideration any rental standpoints.
Instead, in these situations, property owners require the help of property managers; not real estate agents. Property management is one of the most highly regulated industries and those in it have been in the profession for a long period of time. They know the ins and outs of the business and all the laws associated with rental property.
Understanding all involved with becoming a rental property owner is a complicated endeavor. That’s why it’s important to use the services of a professional like a property manager to make the process a bit smoother. If you’re considering buying a rental property, you’re most likely expecting a return on your investment. To ensure you see that return, it’s best to consult with a property manager prior to closing.
Here at Action Properties in Roseville, we generally receive calls from investors asking what areas to purchase in and if certain areas are in higher demand. Property owner in Roseville are fortunate, however, because there is no necessarily good or bad location to own a rental home. If you have a home in Roseville, typically, it’s going to rent.
Generally, homes located near good schools, amenities and parks are most desirable for prospective tenants and generate a bit more rental income. Although this is also true for Roseville, the number of bedrooms, baths and square footage is also important.
If you’re working with a real estate agent, they will consider the market to be a $1 a square foot. However, in today’s market, we have huge volumes, so it’s based upon quantity; something a real estate agent might not understand. With a property manager, however, they’ll ask questions like: What’s being marketed currently? How many homes are being marketed in that area based upon bedrooms, baths and square footage?
So, while an agent may tell you it’s possible to get $2000 for rent; it’s critical you contact a property manager in your area to determine what the actual rental value is. Otherwise, what you thought was a guaranteed $2000 a month, is instead $1500.This will not only leave you disappointed, but start the investment on a sour note as well.
Lastly, it’s imperative that you have a property manager inspect the property before closing to see if there are any issues. Essentially, see what it’s going to take to get the unit rented. Look out for older items in the home in case you might need a home warranty from the seller. A home warranty would help cover any of those older items in the first year of you owning it and having it as a rental.
It takes time and research to purchase a rental property, but one thing is certain, a property manager can eliminate any potential worry for you and help you get the most out of your new rental.
As always, if you have any questions, feel free to contact us.
by Terri Alcala
