Buying investment property can seem overwhelming, but when you know the red flags to watch out for, things will go a lot more smoothly. Learn more about the red flags to watch out for in our latest post!
It seems as if everybody wants to cash in on real estate these days, and with good reason. Real estate investment is an excellent way to create income and even retire early! But not every property for sale is a good investment. There are many things you should avoid when buying New York investment properties. Consider the red flags below before you purchase any investment property in New York!
Red Flag #1: A Bad Neighborhood
Even if you heard from someone who heard from their friend’s agent that a neighborhood is “up and coming” make sure to do the homework for yourself. A bad neighborhood will never attract quality tenants or provide the returns you are after. You will likely deal with high turnover, damaged property and maybe even evictions.
Red Flag #2: The Repairs Are Snowballing
One leaky pipe can lead to damaged dry wall, mold, and so much more. Don’t let repairs slide. You cannot always count on your tenants to speak up if something is wrong. Make sure you schedule regular inspections with your tenant. No to check up them, but rather to make sure everything is well maintained and that there are no repairs needed. Repairs that go undone will lead to more work and money you will need to spend in order to fix the problem.
Red Flag #3: It’s Been On The Market Awhile
Plain and simple, if a good investment is laying around out there, a savvy investor is sure to find it. If a property has been on the market for a long time, there is likely a reason why. If the property is priced low, don’t assume you have found a tremendous deal. Instead, research the property, talk to the owner and simply ask why it is priced so low. The owner is obligated to disclose any problems with the home that have stopped other buyers from pulling the trigger and purchasing the home.
Red Flag #4: Bad Tenants
Bad tenants can be a nightmare. The really, really bad ones can even make someone want to sell their property! Between unpaid rent, property damages and tenant turnover, having bad tenants can suck up all of your profits. If you are purchasing a property with tenants in place, make sure you know what you are getting into and understand that you might have to deal with the eviction process sooner rather than later. Having bad tenants can quickly erase any profits you were seeing from your rental property.
Red Flag #5: Small Rooms
This isn’t so much a red flag as it is something to avoid. Small rooms can deter many renters and keep the property vacant for a longer period of time overall. People like to have a little space. Families will be looking to have enough room for their kids, pets, and stuff. While small homes might be popular for some folks, many others don’t want to feel crowded in their house. Houses with small rooms or a strange layout tend to sit on the market longer than other properties.
Buying investment property can be one of the smartest decisions you ever make. It can also be a very large purchase that you won’t want to take huge gambles with. By avoiding the red flags mentioned above, you will be able to find the perfect property to meet your investment needs!