You have plenty of choices to pick from as a real estate investor in Reno, Nevada. The challenge is finding the right investment properties. In this blog we will help determine this for you. We help both new and experienced investors succeed in Real Estate and make the right decisions. We work with Investors all across Nevada. If you need help finding a good investment property, contact us today for a free no obligation consultation. We will go over what you are looking for and design a custom investment strategy for you. After going over what you need we will locate the right property for you at the best possible price.
So how do you determine your next investment? Here is what to look for in a Reno Nevada Investment property.
The Reno, Nevada market is growing rapidly. As a result, property values have gone up dramatically over the past few years. Finding properties for the right price has become a challenge for both investors and homeowners. You will need to do the right amount of research before buying. There are investors who are buying any type of investment property that comes on the market. This can backfire quickly and this method only works during the upswing of a market. You need to buy at the right price so you are maximizing your Return On Investment (ROI) and ready for a possible unfortunate economic downturn.
You will of course need to afford to buy the house and maintain it for the foreseeable future. There are cost that beyond the listed price. For example, closing cost, title and escrow fees, transfer fees, taxes, HOA start up cost, etc. Does you budget account for any of this? If not you need to calculate what you can afford. Also, you need to factor in holding cost. Unless are buying a rental property with a tenant already on the lease, you will incur these cost. Most investors account for about six months of holding cost. So they have time to fix up the property if needed and get it sold or rented.
The next thing you need to consider is Location. Location is the most important part of real estate since it determines the majority of a properties value. It is the one thing that you can not change and is consistent. For example, if you have a house in Tahoe or near the beach it will be worth more that the same exact house in an area with higher crime rates and poor school districts. You can find a piece of property in an area where you can purchase a property for cheap. However, is it located in a desirable place? If not you might what to reconsider. If you want it to sell or rent faster and for a higher price, you want to look for a investment property that is in an area with high demand. Which leads us to the next step.
The next thing to factor in is the demand of the property. If you are buying a rental home, make sure the market or area is not saturated with other rental properties. Your rental will sit on the market longer than it needs to be. Costing you more everyday that it sits not rented. If you want to get it rented faster, you will have to lower the rent price. Look for lower than normal rent prices to see if the demand for the area is low. If the the market rent is high it might be worth the extra price. As long as you can maintain a good return on investment.
This also applies if you are looking to do a fix and flip. The last thing you want to do is spend thousands of dollars buy and rehabbing the house just to have it sit on the market unsold. You will incur holding cost which will eat into your profits and lower your potential profits. Also, having the possibility of lowering the list price to get it sold.
The only time you want to look for an investment property in an area with low demand, is if there is a high possibility for growth in the area. This will allow you to get a great price. Talk to your real estate agent and ask then if there is a possibly for growth in a particular area.
Another significant thing to be searching for in your Reno, Nevada investment is the curb appeal of the house. You want to make sure it looks clean, safe and well taken care on because no one wants to live in a house that looks gloomy, messy and depressing on the outside. Help maximize the appeal by painting the house and redo the landscaping. If this is already taken care of, that will be a better deal for you. If not, you might want to budget more for this expense. Also don’t forget the backyard. This will appeal more with individuals with kids or pets. Also, this is a great time to put in low maintenance landscaping if you want a rental property.
Repairs can get expensive and you wan to lower these cost. Unless you are buying a turn key property, you should always plan for these. For example, electrical, plumping, roof, etc. Although these types of repairs can get expensive, they are common. However, if you have a house that has structural issues, you will most likely be paying above and beyond to get it corrected. This is a an issue that requires a specialist to fix. You might also need to get permits from the city or county before and after the work is done. Having to wait will take more time and cost you more money as it increases your hold cost.
The foundation of the structure is an incredibly critical aspect to search for. This is where you will need a good inspector. A qualified inspector has the knowledge and have the right tools to look for any possible issues with the structure. Most bank will require you to get an inspection to make sure the house is in a decent condition.
Specialty features is something that will increase the appeal or value of the property. For example a corner lot, house with city or water view, house with a deck, water rights, horse property, extra land, far from the city, fixed up basement, etc. Often times this is a feature that makes the property more unique. Each of these different features will make buyer of renters fall in love with the property since it is a one of a kind.
Have A Exit Strategy
This is the final thing you need to know what to look for in a Reno Nevada investment property. You need to plan ahead and know what your exit strategy is going to be. Of course this is a worst case scenario but you want to have a plan ready if things start to go south. Study the market and make sure you understand what the dips in the market a typically at. An exit strategy usually consists of selling on the market, selling it fast to a cash investor, renting it instead of doing a fix and flip or doing a fix and flip instead of renting. You might also have to consider owning it longer than normal before you renting or selling it. It might also mean it becoming you primary home. There are many ways to structure your exit strategy. Design one that is right for you and your particular situation. Doing this will also help relive stress by as plan in place.
These are all very important things to consider when buying an investment property in Reno, Nevada. If you follow these simple rules, you will increase your chances of succeeding when it comes to investing in real estate.
We help helped many people get started in real estate investing. we give them the proper knowledge and resources to do to. As a result, all of are clients are able to find the perfect investment property that fits them.
If you are looking to get started in real estate, contact us today. No obligation and no hassle. If will be a short call or email to see if we are the right fit for you. We can even meet in person for a free consultation. We help new and experienced investors and we would like to help you too.