Are you looking for an investment with the potential for high returns? An apartment building will supply you with a monthly income for years to come if you manage it well. Here are some things to remember.
Consider a Building With Four Units or Less
If you purchase a building with four units or less, it’ll be easier to get financing. Banks consider these residential structures and will issue you a residential loan.
Stefan Soloviev makes decisions based on the best loans available with the best interest rates. Typically you’ll need a down payment of about 20 percent to purchase a residence that’s an investment property. Decide to live in one of those units, however, and you could qualify for a government loan that requires only four percent of the total cost as a down payment.
Choose the Right Location
Look at the area where the apartment building is located. Is there a business district nearby? You might be able to draw tenants wanting to live close to work. What about restaurants and banks? Easy access to amenities will draw more tenants.
Look at Several Places Before Deciding
Don’t settle on the first building you see. Check out as many apartment buildings as you can to get a good idea of what’s out there, and to make sure there’s a demand for apartments in your area.
Do the Math
No building is a good investment if you can’t get a return on your money. Think of all the costs involved in buying an apartment building, including the mortgage and insurance as well as the maintenance and management costs. Make sure the rents you plan on charging will cover your costs and bring you profit.
Find a Good Real Estate Agent
You want an agent who’s on your side and who represents only you. Don’t hire an agent and then look at properties that the agent has listed. An agent who represents both the buyer and the seller won’t have your best interests at heart. Also, check to make sure the agent is licensed by contacting your state realty board.
Check the agent’s reviews online to make sure other customers are pleased with the work that the agent does.
By taking these measures, you’ll find a building that works for you and that will appreciate in value. You’ll have a steady, inflation-proof income for years to come, providing for a comfortable retirement.