Basics of Property Management: Screening Potential Tenants
Three Locales Of Prime Real Estate For Investors
Jesse Obrien
If you have decided to become an investor in real estate, there are some prime locations where you should absolutely invest in the property. Some of these are common sense, while others may surprise you. The following three locales should get you started and help you think about what properties you want to invest in.
Waterfront Property
Waterfront property is pure real estate gold. Everybody with money wants access to the water for boating and yacht or sailboat storage. If the property is not a residential property but a warehouse or industrial property on the water, then buyers want it for shipping, exporting, and importing purposes. Because there is always access to the water, the buildings themselves could be rag-tag, run down structures and the property would still maintain a very high real estate value. Therefore, you should definitely buy waterfront property of all kinds when it becomes available.
Property in Run-down Areas
No, you are not a slum lord if you buy property in run-down neighborhoods. In fact, if the city in which these properties dwell has major redevelopment plans for the areas around these properties, you could make quite a fortune. As the city builds up the area and makes it more enticing and inviting to families and businesses, your property values begin to go up. They could even skyrocket within a year or two, and then you can sell them for quite a bundle of cash. It is like buying in low in the stock market and waiting for the value to rise; you know it will.
Properties Located Near Popular Tourist Destinations
The closer a property is to a popular tourist destination, the more valuable it is. For example, a residential home less than ten miles away from Walt Disney World in Orlando has between double and quadruple the value of the exact same home anywhere else in the US. Buying up properties of this sort when the market is a "buyer's market" can result in a nice little profit when the market turns around and becomes a "seller's market" in a few months to a couple of years. However, given the prime locale of these properties, you usually do not have to wait very long to sell and turn a profit because homeowners love being so close to popular travel destinations. This is especially true for the last decade, when "staycations" have become very popular and people do not want to travel far for amusement.
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For the last several years, I've used a property management firm to help with my rental properties. One of the tasks that they handle for me is screening applicants who would like to move into one of my vacant units. Their expertise has helped me lower my tenant turnover and find people who want to stay with me for years. Part of the process is a tenant screening credit check. Before any further contact takes place, my manager orders credit reports from at least two agencies. That is enough to tell us if an applicant is a good financial risk. Assuming the references work out, I meet the candidate and make the final decision. If you own rental properties, let me tell you more about the benefits of having a property manager. I'm betting you'll find this type of arrangement will work for you too.