Many people nowadays want to have an investment property which can prove to be lucrative for them. You also might be planning to have a property that can be profitable.
If you do not know what it exactly is, then let me tell you first!
Investment property is a house, condo or commercial place purchased with the intent of earning either through rent or by reselling it. The buyer does not live here; instead, he/she gives it on rent to others to make money.
Mainly, buying it depends on your income and savings. But before purchasing it, you should do enough research and read the following tips for buying an Investment Property in Canada. Out of the following tips, fourth and fifth are essential but do not forget to go through the other points too.
- Examine which area can bring high Return On Investment
Look for that area which can help you in getting a high Return on Investment( ROI). Gentrified and transitioning areas can help in bringing profitable deals. Examine what kind of properties are ideal for high ROI in that particular area you are planning to buy. Also, look for parks, malls, theaters nearby the house. Most people will prefer to get a place with more facilities in the neighbor.
- Avoid a Fixer-Upper
Try to avoid such houses that require several fixes to make it liveable. It can take additional months and cost to make it perfect for renting. To prevent such future headaches and expenses go for the house which requires minimum amendments as possible.
- Pay your Debt first
If you are having unpaid debts like medical bills, loans or if your children are going to get admission in college soon, then postpone the plan of buying an investment property for now. Never dump yourself in a position where you will fall short of money for paying off your debts.
- Determine Operating Expenses
Calculate the operating expense that you have to pay before fixing the rent. Generally, the expense can be between 35 to 80 percent.
- Buy from a Professional Agent
Consult with two to three agents and buy from the one which satisfies your budget and seems to be a professional person to you. An experienced agent will always suggest you the best and affordable place keeping your budget in mind.
- Are you ready to become a Landlord?
Becoming a landlord brings in many responsibilities. You have to solve the issues of your tenant on time to keep him/her happy. You might have to call plumber or electrician at times for repairments. So if you are ready to take care of the needs of your tenant only then go for an investment property.
It may not be possible for everyone to take the duties that come by wearing the hat of a landlord. So consult with an expert before buying an investment property. I hope, the above-given tips have helped you in deciding whether it is the right time for you to buy a home or a cond