After riding the ups and downs of the stock roller coaster for some time, a growing number of investors seeking to own property as an investment more stable alternative. With hot markets in many parts of the United States, it may be time for you to get into this potentially lucrative trade. I would say, however, that you continue to read before you jump on the first property that you find. Perhaps you can find something in this article that will prevent you from the bank and break your back.
Hopes of an investor is to create long-term wealth, which is a relatively simple principle, and no doubt the reason why you are reading this article. There are some rules to follow in establishing the investment game if you do not want to end up taking a shotgun with you every time the rent must be collected. I am talking about how to avoid becoming a "slumlord.
order to better connect the rules of a successful owner, let me share a story by some members of the extended family. It is a great example of what NOT to do if you want to get the most out of your investment. After history, we will see what the rules and the lessons we can learn. The names have been changed to protect the identity of innocent people.
Ben buys a stack single investment property in an area very bad and he has his two sons, Josh and Nathan all been occupied. They put in flooring-n having to replace the carpet every time you turn, right? And then they thought "very good use of paint don't want to have to repaint every time, right? And then they decided to splurge on good cabinets and bathroom accessories - a happy tenant is a good tenant, right? And to top it all, they have nice nice towels on the racks that said: "We are family." Tenants appreciate that, right?
Right.
The first family to go to the bedroom and removed cabinets firewood, tore out the bathroom and accessories sold in the swap meet, and fired small arms through new series procuratorates. Ben discovered this when he received a call that the roof was leaking, and should, "Get your *** here, and fix it!" He has patiently tried to explain that the roofs do that when you pull shingles for ignition. Other visits wonderful ensued, prompted by similar calls.
It took only eight months to pull them out of the house that is tenant rights as defined by the county enumerate more rights than the rest of us enjoy collectively. As the family left he noticed that the mother and two boys aged all worn with matching shirts sewn " We are family. The rest performed various parts of the house.
Ben, Josh and Nathan began to rebuild the house, finding all kinds of interesting changes to its structure. Nothing really serious other than a beam of support has been sawn in the chain - (apparently more firewood), pried tiles in a bathroom-not clear why the signs of gangs in all scratched glass and mirrors that weren't broken and other little surprises. When drilling under the house to repair holes in plastic bullets in a leaking sewer pipe, Nathan found a Bong and a bag with a weed. I guess if you're stoned you tend to misplace things.
While supporting restring some space exploration wire-strung later found in the closet for hangers-Josh found a rusted over .32 caliber handgun. Somehow tenants had managed to pull bricks from the chimney, which needed to replace Ben to meet code. Apparently, someone had driven a M1A1 Abrams of the aisle, there was no way to explain the huge cracks in a driveway which had remained perfect for 20 years.
What can we learn from this horrible, but unfortunately true story?
Rule 1
Location, Location. Okay, this may sound a little corny, but it is a fact that the location of your property investment will determine the type of tenants you attract, and how much rent you can charge enough. Remember, at some point in the future it may become necessary for you and your family to live there, what kind of neighborhood do you want to do?
Rule 2
Do not go overboard when you are setting a good investment. You should expect normal wear and tear. Keep in mind that "wear and tear" means something quite different to a person renting it does to an owner. And forget for the sake of goodness, "We are family" towels!
Rule 3
Knowing how to make basic repairs. Fortunately for sons Ben and they had quite a bit of experience in various construction trades. Otherwise, they may have lost even more money than they have for help with the hiring. Knowing how to repair electrical wiring, repairing sewers, and replacing the windows will save you a lot of money on the road.
Rule 4
Tenants your screen as if they were moving in to live with you. This may be the most important step to avoid becoming a slumlord. Request and check references. Call previous owners and ask questions like, "Do they pay rent on time? How is the state of the house / apartment when they left? Have they never disturb the neighbors with loud music or screaming matches? How often do you have to travel for repairs inappropriate? "Being informed that you can rent that will make a big difference in your return on investment.
Rule 5
Know your rights as owner. Become familiar with the eviction process in order to avoid long and disputes with the tenants. Most states and counties to provide online information on tenant and landlord rights.
Do not repeat the mistakes made by Ben and his sons. Certainly, going into property investment firms takes hard work and you have to put up with things you normally would not put in place. At the same time, there are steps you can take to limit your liability, while preventing yourself from becoming a "slumlord.
In the next part of this two-part article we will discuss some of the financial aspects you should be familiar with in order to find the best deal possible on your initial investment.
About the Author
Cameron Brown is a client account specialist with http://www.10xMarketing.com – More Visitors. More Buyers. More Revenue.
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