How To Choose The Right Property For Investment (Real Estate Ideas)

How To Choose The Right Property For Investment (Real Estate Ideas)

right property investment

If you’re looking to find the right property for investment, then you need to keep a few things in mind. Below are some real estate investment philosophies for you to consider before you buy.

Property investment is perhaps one of the best avenues for investment you can ever take on in life. 

When you invest in property (whether to live in or to rent out)  you create a wonderful method for making money.

The right property investment can provide you with some great passive income  and/or growth on your money.

right property investment

We had fun renovating my son’s bedroom

Today I want to talk about one of the specific parts of property investment that can be tricky: investing in residential real estate.

I’ve personally invested in New York residential real estate – and found it to be an amazing chance to widen my investment portfolio and bring monetary stability.

I also had fun renovating the space where we live.

But how do you know which is the right property for investment? Here’s some thoughts on real estate investing.

How To Choose The Right Property For Investment

1. Look for growth potential

right real estate investment
It is important for you to assess both the intrinsic value of a home as well as the area it’s located within.

For example…

  • Look at the pricing of similar homes – and explore how the price for the property you’re interested in compares to the most recent property sales.
  • Explore if there’s a new bus or subway service being set up in the area – or a new supermarket or shopping center being built – then you can guarantee that more people will be drawn to move to the location. As a result you should consider investing in the property.

2. Invest where you know 

If you’re considering renting out the property you plan to buy, then it’s easier to invest in property close to your present home.  After all, no one will know your area better than you. This knowledge is power – and can be helpful in terms of assessing the profitability of your investment. Plus, should any problems with the tenant – or property – arise, then you will be conveniently nearby.

Of course, you don’t have to invest in your own home town. But if you are to invest it is important to take the time to learn more about the area first, to know if it’s the right property for investment.

3. Look for something which is not cookie cutter

There should be at least one “wow” factor for a property to be a good investment.

  • Amazing closet space.
  • A beautiful view.
  • Modern appliances.
  • A gorgeous garden.
  • Brilliant layout.
  • The discounted price.

4. Seek a popular location with a busy market

Although it might be difficult to buy a property if the market has a ton of competition, this is always the best thing to do.

By buying a property in an area with high competition, you will be able to make a bigger profit through rent. 

right real estate investment
We personally chose to invest in a smaller sized home – in order to be able to afford living in an awesome location.

Why?

Even though our home was smaller than what we wanted, we knew the apartment would always have strong resell value – because this neighborhood is loved so greatly.

Plus, we loved the quality of life living in this neighborhood would bring our family: great restaurants, fabulous schools, convenient movie theaters, a nearby farmer’s market, a local dog run, etc…

Basically, you know you have the right property for investment if it satisfies these 3 things:

  • location, location, location!

5. Consider something which needs renovation

right property investment
If you head to an auction and buy an old property for peanuts, you likely will have no problems carrying out some hefty renovation without going over budget.

However, what if the property is fairly new and already full price?

Ideally, you never want to buy a full price property that needs a lot of work.

The most you should be doing is changing the wallpaper and paint work. 

6. Understand tenants 

A good way to discover if a home is the right property for investing: talk to a prospective tenant.

If you already have a tenant in mind, you can choose a property based on what they need.

And/or – try to talk to tenants already living in the building or neighborhood. Find out the pros and cons of living in this location.

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