There are various types of investment properties available in the real estate market ranging from single-family houses, multi-family houses, townhouses, and apartments. With so many options open to property buyers, deciding which property is the best to purchase is likely the most critical decision they can make.
As a real estate investor, your investment property will determine whether you succeed or fail. With every real estate investor aiming to make money, those properties that will guarantee good ROI and a steady inflow of cash, in the long run, are the best investment properties.
Therefore, to succeed, the property's purchasing price should not be the topmost priority or focus of any real estate investor. Here are some of the features to look for in any investment property for sale:
- Location of the Property
One expression you'll hear a lot in real estate investment is location. The location of an investment property impacts everything ranging from the rental rates a property owner will charge, to the operating costs and cash flow, to appreciation. All these are additional factors that decide investment properties' profitability.
The best investment properties can be referred to as those properties situated in desirable areas. But what factors influence the profitability of a particular location?
Good locations are those with fair investment property taxes and adequate insurance, making a good standard of living beneficial to property owners.
In addition, if investment properties are leased for a certain amount in a neighborhood, property owners can rent in the range. Hence, the best investment properties are in places where rental revenue is high, allowing you to charge higher rents.
Furthermore, even if a real estate investor locates the best investment property in a desirable area, he or she will not benefit until tenants are found. As a result, a good location is beneficial to the real estate investors and attracts tenants.
For instance, when renting out a single-family home, the target clients are usually families. Families often seek out healthy neighborhoods with low crime rates, child-friendly, have work openings, and are close to schools, health services, and public transit. So keep an eye out for investment properties in these areas.
- Estimated Cash Flow of the Property
The estimated cash flow is the next critical factor that decides the viability of investment assets. Every real estate investor desires to generate income from their investment property. Investors have to invest in good cash-flow assets to keep earning profits.
When the incoming cash flow exceeds the outgoing cash flow expended on handling and sustaining the investment property, you have positive cash flow. If the cash flow of a building investor is negative, he/she loses money rather than make money out of the rental property, which is what no real estate investor wants.
Therefore, property owners must conduct due diligence on the real estate market before investing in a rental property to ensure that it yields a positive cash flow.
Furthermore, they must assess and budget their finances correctly and spend all potential expenditures wisely. This way, there will be a sustainable positive cash flow from the property.
- Adequate Sanitation
It's impossible to discuss the characteristics of a productive rental property without including sanitation. The rental property you wish to purchase must be located in an area with sufficient sanitation. Tenants prefer to avoid areas where good hygiene and sanitation are lacking.
Imagine living in an environment where flies can fly in and out at will, where drains are left open, and where the drainage system is poorly maintained.
Choose a property that has adequate sanitation. Ensure that the waste disposal, toilets, sanitary equipment, septic tanks, water, and sewerage are sound. The cleaner the house, the higher the chances of getting tenants, and the higher the profitability.
- Required Cost of Maintenance
Although investing in luxury rental properties can yield massive profits, buying and maintaining them is very costly. Getting the best investment properties will ensure that you get decent properties that minimal amount of money and time to maintain.
Additionally, investment assets requiring little maintenance often take a short period to purchase and find a renter. Since it takes less time to be rented out the property, the property becomes more profitable as the investors start making money from them quickly.
- High Appreciation
While it is good to invest in a rental property located in a profitable area, consider how worthwhile and valuable that area will be in the future.
Acquiring investment properties for sale in areas with high appreciation would yield more revenues as the value increases in the long run. The real estate investor would also incur greater profitability when they decide to sell the property.
Areas where there are expectations of significant economic growth and areas where availability of land is becoming limited, are places where you can find the best investment properties. Regions where there are plans for infrastructure development projects, tourist attractions, and major market areas all attract high appreciation.
How To Find Investment Properties For Sale
Real estate investment can be a highly lucrative project or a financial mistake, depending on how it is done. Without purchasing a profitable property in a thriving real estate market, it won't be easy to make money.
Hire the services of an excellent real estate agent or company to help you find NNN properties for sale.
You can also work with buyers brokers like NNN Deal Finder that partners with reputable brands to provide their clients with favorable, long-term NNN lease investments that guarantee more reward and minimal risk.
For investors asking, "how can I find an investment property near me?" Real estate agents can also assist you in locating a nearby investment property. There are also real estate websites that can help to find these properties quickly.
When looking to invest in real estate or any investment property for sale, certain features and factors must be considered before making choices. We've carefully explained some features that make an investment property profitable. The features mentioned earlier will generate a fruitful investment journey and passive income opportunities from real estate.