As a real estate investor, you have a lot of options to choose from in Milwaukee, Wisconsin, so how do you choose your next investment? Here are 6 things to look for in your Milwaukee investment property.
First of all, you have to look for the affordability of the investment property. Right upfront, you have to be able to afford the purchase price, whether you are paying in cash or need to obtain a loan. If you are paying in cash, you need to make sure you have enough to cover the purchase price and any closing costs or association or transfer fees to purchase the property. You then need to make sure that if there is an association, you can afford to pay for the association fees if you are not collecting rent right away. If you are obtaining a loan to purchase this property, you will have to do some research to find a lender that is willing to originate for an investment property. Keep in mind that it is more difficult to find a loan for vacant land than a residential building.
The second thing that you should look for in your Milwaukee investment property is the demand. Before you purchase a rental property, make sure that the market isn’t flooded with rental properties that are already available. If it is, then a good tactic is to lower your rent so you can attract renters more quickly. If the average rent is already quite low, then probably there is no need for another rental property in the neighborhood. If the rent is high, then it means that there are a lot of renters looking for a home, which means that you will most likely quickly regain the money you’ve spent on it.
Another rather big thing that you need to look for in your Milwaukee investment is the property’s curb appeal. The house needs to look clean and well maintained, as no one wants to live in a messy, depressing house. The walls need to be freshly painted and the landscaping should be nice. You can do all of this yourself, but if you manage to find a property that has all of this sorted out, you’ll save yourself a lot of money and trouble.
An extremely important thing to look for in your Milwaukee investment property is the structure of the property. This is where an inspector comes in handy. They are specially trained with specific equipment to identify any structural issues with the property. If you are taking out a loan to purchase this investment property, the bank will most likely require an inspection to make sure they are placing their funds in a solid structure.
Something else to look for in your Milwaukee investment property is something that makes the property unique. For some, it could be an interesting waterfall into the pool, or maybe a re-purposed table turned into a back porch dry bar, or a cluster of fruit trees on the property. All of these special features can make potential renters or buyers fall in love with the property and want it to be theirs.
The most important thing to look for in your Milwaukee investment property is the exit strategy. You must plan ahead. Study the trends of the area and make sure you understand if there is a dip or growth coming. If people begin to migrate out of the area to a different area, you need to get out of that investment, the market rent might start dropping to attract new renters. If property values start dropping too much, you may need to sell your investment. If you personally enjoy the house, you might want to think about retiring there!