There has never been a better time to be a landlord. With so many short sales and foreclosures on the market, there are plenty of great properties to be had at low prices. The first thing you need to do is find a quality investment property that suits your needs and your budget, but you'll need to take a few things into consideration first.
How Many Tenants Do You Want To Manage?
Do you want to be a landlord to just one tenant or do you want to be a landlord to several tenants? If it is just one tenant, you can find a single-family dwelling or a condo to purchase as your investment property. It is commonly known that condos do not appreciate as well as single-family dwellings so this is something you might want to keep in mind. With a condo you also have to pay maintenance fees monthly and you would need to add that to the monthly rental payments to cover the additional expenses. If you want to manage several tenants, you can look for a duplex or a small apartment building. If you have never been a landlord before, it is probably a good idea to start out just having one or two tenants.
Finding the Right Property
Have you heard the phrase, "location, location, location?" This is just as important for rental properties as it is for buying a new home, so thoroughly research the neighborhoods before you buy a rental property. If you wouldn't want to live there, chances are that potential tenants are not going to want to live there either.
Finding the Right Tenants
Finding the right tenants is not always an easy thing to do. You want someone who will take care of your property. You certainly don't expect them to make improvements to your property, but you absolutely don't want them to cause destruction that will bring down the value. How do you go about finding the right tenant that is going to take care of your property? You can start with a background search. There are a few different kinds of searches that can be done so you can determine if these prospective tenants are right for you. Other options include criminal records checks and credit reports. You'll also want to check the sex offender registry and check for bankruptcies, foreclosures, aliases and employment verification.
Once you know how many tenants you can handle and how you will find the best applicants, it's time to look for the investment property that meets your needs. A prepared and educated landlord can see a handsome secondary revenue stream from rental property.