Some people invest in property for the lifestyle it will give themselves and their family; for others, it’s a business. If you’re one of those for whom it’s a business, you’ll want to make sure that your choices for rental properties tick all the right boxes. Making small mistakes here and there can pay off big time for getting a return on your investment. Real estate is a business for many people, so start treating it like one.
If you’re not sure where to start, don’t worry. Some tried and tested tricks can help make flipping a rental property that much easier. To make sure your property choices make you money, rather than losing it, keep these tips in mind when flipping a rental property.
Find areas with high demand.
Rental properties will give you the highest possible return on your initial investment when they’re in the right location. Identify a location that’s either convenient for you or where you can find a property manager that also has a high demand for rental properties. Perhaps it’s a student city, where there’s a high turnover of tenants, or it’s a vacation destination, where you’ll have a near-guaranteed flow of fresh potential tenants.
From there, search using local filters and tools to find the perfect property, like this one for Houses for Rent in Islamabad. Once you’ve found a property that’s in high demand, you know you’re on to a winner.
Look for value opportunities.
Now you’ve got the right property; you can also start adding value as much as possible. Depending on the type of property and the location, certain features can help convince make your property more desirable. Adding a swimming pool in a holiday home in a warm climate would be one such example. Research further into how to increase the value of your home, with details that are specific to your circumstances. The more value you can add, the greater your return on your investment will be.
Even something as simple as renovating a basement or attic space can do wonders. Whatever you can do to get your property to stand out against your numbers is always a smart move. Real estate can get competitive, so do your best to stay ahead of the competition. Look at other high-value homes in the area: what are they doing that you could cache in on? What are they missing that you could take advantage of?
Sort your finances.
If you’re committing to a long-term renovation project or a high-value property, you need to make sure all your finances are in order as well. Look into ‘private money lenders near me‘ to see if you can get some extra capital to invest in your property. For example, updating the kitchen and living space into a modern style might cost a small amount in the short-term, but it could dramatically improve the selling price when it comes to flip.
Getting the right kind of loan can set you up for big wins down the line if you know precisely what you’re doing financially. You need to establish how much you need and how much of a return on your investment it might bring you. Please do your research before committing to a big build; the last thing you want is to invest in an apparently valuable asset, like a swimming pool, only to find out that no one in the area is actually interested in them. It’s a fast way to make a bad investment, which can end up damaging your whole portfolio.
Attach to a worthwhile cause.
You could also think ahead for marketing opportunities down the line. See if you can add something to your property that will make it really stand out, like attaching it in name or action to a worthwhile cause from around the world that everyone can identify with and will likely support. For example, Hayes Barnard is attached to Give Power, a solar water farm that provides clean water for families across Kenya. There might be some way to incorporate their values into your home, perhaps through a solar energy farm on the property.
Having something that people can be proud of makes for a great unique selling point for the property, plus it can add value down the line. For example, with solar energy, the homeowner can actually sell any excess energy back to the grid for a profit in many locations. Depending on your own imagination, there are tons of great causes out there that can be mutually beneficial. Find one that makes sense for your home and your potential buyers, and bring it to life.
Keep looking for some of the bigger up and coming trends.
With falling travel trends and less disposable income worldwide coming up in 2021, it might be wiser to invest in affordable urban housing for young people looking for work rather than more expensive luxury travel homes. This is just one example of why it’s smart to keep one eye on the future when working in real estate. It could look very different for your property and your target market, which is why it’s always vital to make sure your research and data are specific to your circumstances.
Although you want to keep your design classic and easy to adapt to potential buyers and tenants, you should stay on top of what is selling well in the world of real estate. That could be anything from the properties you buy to the features you renovate or add to your property.
With these ideas in your back pocket, your foray into real estate investing is sure to be a success. Remember to plan carefully and always prepare for the worst eventuality. Having some extra time and money on your side is far better than being pushed for time or – even worse – running out of money. Take your time, get creative, and have fun with your next rental property project, wherever in the world it is!