206-999-1690
larryreichle@remax.net
LOGIN | REGISTER

Larry & Kathy Reichle

Issaquah Real Estate | Call: 206-999-1690

  • Home
  • About
    • About Larry & Kathy Reichle
    • Testimonials
    • Larry and Kathy’s Resume
    • References
  • Home Search
    • Search Options
      • Map Search
      • Advanced Home Search
      • Simple Home Search
      • Search by Address
      • Search by City
    • Search by Communities
      • Bellevue Real Estate
      • Issaquah Real Estate
      • Kirkland Real Estate
      • Maple Valley Real Estate
      • Redmond Real Estate
      • Sammamish Real Estate
  • Buyer
    • Lender
    • Thinking of Buying?
    • Mortgage Calculators
    • My Search Account
  • Seller
    • Thinking of Selling?
    • Our Sold Listings
  • What’s MY Home’s Value
  • Blog
    • Eastside Real Estate Blog
    • Issaquah Community Blog
  • Contact Information

Eight Things You Need To Know Before Buying Your First Investment Property

August 28, 2018 by Kathy Reichle Leave a Comment

 

Although there are numerous examples of people who have earned themselves a fortune with real estate investment, real estate, like every other business, has many risks associated with it. Moreover, regardless of the type of property you are purchasing or whether you plan to rent or resell it afterward, investing in real estate requires a good amount of cash — which makes it critical to take extra measures to ensure profit on your investment or at least save yourself from a huge loss.

I’ve observed a shortage of property in good areas over the past few months. This lack of property creates an excellent opportunity for investment. However, it doesn’t mean that anybody can earn a fortunate by investing in real estate. You need to know a lot of things before buying your first investment property.

1. Don’t let your emotions play with you.

Most of the time when buying a home, people listen to their heart more than actually thinking about it logically, which is perfectly fine when it is the place where you will be living for many years of your life. But don’t let your emotions affect your decision when buying your first investment property. Think of it as purely a business investment and logically negotiate to get the best possible price.

Remember, the lower the price you get for a property, the better the odds that you will earn a higher profit from it.

2. Do your research.

Depending on the clients you are targeting, you need to do proper research before buying your first investment property. Make sure that the property is situated in a location that will attract the type of clients you hope to sell or rent to, that it will reach to the returns you are expecting and that it will appeal to the market.

Doing the proper researching and using an analytical approach logically based on the financial factors, rather than considering your personal likes and dislikes, will surely help you in purchasing the best property. After all, investment isn’t about emotions; it’s about economics.

3. Secure a down payment.

Unlike the 3% down payment on the house you are currently living in, you are going to require at least 20% down payment for buying your first investment property. This is because mortgage insurance is not applicable for investment properties. Moreover, investment properties require greater down payments than your regular building and have strict approval requirements. Keep in mind the expenses needed for the renovation before you pay your down payment.

4. Calculate expenses and profits beforehand.

As the expression goes, only the paranoid survive. OK, not always, but there is no harm in being a little paranoid and considering every detail beforehand. Start with calculating the money that you already have and what you can borrow before buying your first investment property. Next, calculate how much it would cost to purchase and renovate the house. Also, keep in mind the operation costs. Finally, estimate the price you are going to list your property for and cut out the expenses to get a rough estimate of the profit you stand to make. Honestly speaking, you may not even hit half of the estimated profit, but this calculation is necessary to keep yourself in the safe zone.

5. Select a low-cost home as your first investment property.

Even if you are ready to invest up to a million dollars in your first investment property, it is always a good idea to go for properties that lie in the lower- to mid-range price brackets. Some experts suggest the house that doesn’t cost you more than $150,000. Don’t forget, you will need to spend more money on the renovation of the house before renting or selling it.

Furthermore, since it is your first investment property, keeping your investment as low as possible will help you stay in the safe zone. Even if you don’t hit the expected profits, you won’t risk losing too much on it.

6. Pay your debts.

As a new investor buying their first investment property, you might need to consider the investment loan options — one shouldn’t be carrying debts as their investment portfolio. You must clear all of your debts, student loans, medical bills, etc., before starting out in real estate.

7. Consider investment loan options.

There are a large number of options available when it comes to collecting funds to purchase your first investment property. Choosing the right option that could make a positive difference to your financial situation requires a lot of research.

Different investment loan options come with different benefits, and the best possible option depends on your situation. However, you need to consider features such as which loan option is giving you the freedom to split the credit or if it provides you with the line-of-credit facility.

8. Choose your partners carefully.

Many people consider partnering up with their friends instead of talking an investment loan to start in the real estate business. First-time investors need to carefully consider many factors while choosing partners, such as how comfortable you are with them and the implications of a partnership agreement.

Like every other business, investing in real estate can go either way: You could earn a good chunk of money, or it might turn into a disastrous experience. If you follow smart tips and play it safe from the start, you will surely be on the winning side.

POST WRITTEN BY

DC Fawcett

Filed Under: A Positive life, Eastside Real Estate Blog, Finances, Financial Planner, Homeownership, Investing in Real Estate, Issaquah Lifestyle Blog, Issaquah Real Estate, Larry and Kathy Reichle, Mortgage Rates Tagged With: Finances, Getting Ahead, Home Trends, Investment Properties, Issaquah Real Estate

Eastside Real Estate Blog

The Cost Of Purchasing A Home In The U.S. Increased 55% Last Year. But It’s Still A Great Time To Buy A House For These Five Reasons

I’ve always been all-in on homeownership. Yet, for the first time in two decades since the beginning … [Read More...]

New Listings Signal Hope Is On The Horizon For Home Buyers

At the midpoint of April, housing markets are reflecting a changing landscape, according to a new … [Read More...]

Upscale Kitchen Features That Can Boost A Home’s Value

Between preparing to host family and friends for Thanksgiving and making gift lists and checking … [Read More...]

Contact Us

Issaquah real estate

Larry & Kathy Reichle

371 NE Gilman Blvd. #160
Issaquah, WA 98027

Phone: 206-999-1690

Contact Us

Digital Millennium Copyright Act Notice (DMCA)

Real Estate Tools

  • Search AccountCreate your Custom Home Search Account
  • Map ViewSearch For Eastside Real Estate With A Map Style Search
  • Email AlertsSign Up To Get New Listings Delivered To You via Email
  • My Home’s ValueCustom Tool To Get the Accurate Price of your Home

Eastside Real Estate Blog

The Cost Of Purchasing A Home In The U.S. Increased 55% Last Year. But It’s Still A Great Time To Buy A House For These Five Reasons

I’ve always been all-in on homeownership. Yet, for the first time in two decades … Read More

New Listings Signal Hope Is On The Horizon For Home Buyers

At the midpoint of April, housing markets are reflecting a changing landscape, … Read More

Real Estate in the Pacific Northwest

Real Estate in the Pacific Northwest

  • Aberdeen, WA Real Estate
  • Acme, WA Real Estate
  • Addy, WA Real Estate
  • Adna, WA Real Estate
  • Airway Heights, WA Real Estate
  • Alger, WA Real Estate
  • Algona, WA Real Estate
  • Allyn, WA Real Estate
  • Aloha, WA Real Estate
  • Amanda Park, WA Real Estate
  • Amboy, WA Real Estate
  • Anacortes, WA Real Estate
  • Anderson Island, WA Real Estate
  • Appleton, WA Real Estate
  • Ardenvoir, WA Real Estate
  • Ariel, WA Real Estate
  • Arlington, WA Real Estate
  • Ashford, WA Real Estate
  • Auburn, WA Real Estate
  • Bainbridge Island, WA Real Estate
  • Baring, WA Real Estate
  • Battle Ground, WA Real Estate
  • Bay Center, WA Real Estate
  • Beaux Arts, WA Real Estate
  • Beaver, WA Real Estate
  • Belfair, WA Real Estate
  • Bellevue, WA Real Estate
  • Bellingham, WA Real Estate
  • Benton City, WA Real Estate
  • Beverly, WA Real Estate
  • Bickleton, WA Real Estate
  • Birch Bay, WA Real Estate
  • Black Diamond, WA Real Estate
  • Blaine, WA Real Estate
  • Blakely Island, WA Real Estate
  • Boistfort, WA Real Estate
  • Bonney Lake, WA Real Estate
  • Bothell, WA Real Estate
  • Bow, WA Real Estate
  • Brady, WA Real Estate
  • Bremerton, WA Real Estate
  • Brewster, WA Real Estate
  • Bridgeport, WA Real Estate
  • Brier, WA Real Estate
  • Brinnon, WA Real Estate
  • Brush Prairie, WA Real Estate
  • Buckley, WA Real Estate
  • Bucoda, WA Real Estate
  • Burien, WA Real Estate
  • Burlington, WA Real Estate
  • Camano Island, WA Real Estate
  • Camas, WA Real Estate
  • Carbonado, WA Real Estate
  • Carlsborg, WA Real Estate
  • Carlton, WA Real Estate
  • Carnation, WA Real Estate
  • Carrolls, WA Real Estate
  • Cashmere, WA Real Estate
  • Castle Rock, WA Real Estate
  • Cathlamet, WA Real Estate
  • Center Island, WA Real Estate
  • Centerville, WA Real Estate
  • Centralia, WA Real Estate
  • Chehalis, WA Real Estate
  • Chelan, WA Real Estate
  • Chelan Falls, WA Real Estate
  • Cheney, WA Real Estate
  • Chimacum, WA Real Estate
  • Chinook, WA Real Estate
  • Cinebar, WA Real Estate
  • Clallam Bay, WA Real Estate
  • Cle Elum, WA Real Estate
  • Clearlake, WA Real Estate
  • Clinton, WA Real Estate
  • Clyde Hill, WA Real Estate
  • College Place, WA Real Estate
  • Colville, WA Real Estate
  • Conconully, WA Real Estate
  • Concrete, WA Real Estate
  • Connell, WA Real Estate
  • Conway, WA Real Estate
  • Copalis Beach, WA Real Estate
  • Copalis Crossing, WA Real Estate
  • Cosmopolis, WA Real Estate
  • Cougar, WA Real Estate
  • Coulee City, WA Real Estate
  • Coulee Dam, WA Real Estate
  • Coupeville, WA Real Estate
  • Covington, WA Real Estate
  • Crane Island, WA Real Estate
  • Creston, WA Real Estate
  • Curlew, WA Real Estate
  • Curtis, WA Real Estate
  • Custer, WA Real Estate
  • Cypress Island, WA Real Estate
  • Danville, WA Real Estate
  • Darrington, WA Real Estate
  • Davenport, WA Real Estate
  • Decatur Island, WA Real Estate
  • Deer Meadows, WA Real Estate
  • Deming, WA Real Estate
  • Des Moines, WA Real Estate
  • Doty, WA Real Estate
  • Dryad, WA Real Estate
  • Dupont, WA Real Estate
  • Duvall, WA Real Estate
  • East Olympia, WA Real Estate
  • East Wenatchee, WA Real Estate
  • Easton, WA Real Estate
  • Eatonville, WA Real Estate
  • Edgewood, WA Real Estate
  • Edison, WA Real Estate
  • Edmonds, WA Real Estate
  • Elbe, WA Real Estate
  • Electric City, WA Real Estate
  • Ellensburg, WA Real Estate
  • Elma, WA Real Estate
  • Elmer City, WA Real Estate
  • Entiat, WA Real Estate
  • Enumclaw, WA Real Estate
  • Ephrata, WA Real Estate
  • Ethel, WA Real Estate
  • Everett, WA Real Estate
  • Everson, WA Real Estate
  • Fall City, WA Real Estate
  • Federal Way, WA Real Estate
  • Ferndale, WA Real Estate
  • Fife, WA Real Estate
  • Fircrest, WA Real Estate
  • Ford, WA Real Estate
  • Forks, WA Real Estate
  • Fox Island, WA Real Estate
  • Freeland, WA Real Estate
  • Fruitland, WA Real Estate
  • Gardiner, WA Real Estate
  • George, WA Real Estate
  • Gig Harbor, WA Real Estate
  • Glacier, WA Real Estate
  • Glenoma, WA Real Estate
  • Gold Bar, WA Real Estate
  • Goldendale, WA Real Estate
  • Goose Prairie, WA Real Estate
  • Graham, WA Real Estate
  • Grand Coulee, WA Real Estate
  • Grand Mound, WA Real Estate
  • Grandview, WA Real Estate
  • Granite Falls, WA Real Estate
  • Grapeview, WA Real Estate
  • Grayland, WA Real Estate
  • Grays River, WA Real Estate
  • Greenbank, WA Real Estate
  • Greenwater, WA Real Estate
  • Guemes Island, WA Real Estate
  • Hansville, WA Real Estate
  • Harrah, WA Real Estate
  • Harrington, WA Real Estate
  • Hartline, WA Real Estate
  • Henry Island, WA Real Estate
  • Hobart, WA Real Estate
  • Hoodsport, WA Real Estate
  • Hoquiam, WA Real Estate
  • Humptulips, WA Real Estate
  • Hunters, WA Real Estate
  • Hunts Point, WA Real Estate
  • Ilwaco, WA Real Estate
  • Index, WA Real Estate
  • Indianola, WA Real Estate
  • Ione, WA Real Estate
  • Issaquah, WA Real Estate
  • Juanita, WA Real Estate
  • Kalama, WA Real Estate
  • Kapowsin, WA Real Estate
  • Keller, WA Real Estate
  • Kelso, WA Real Estate
  • Kendall, WA Real Estate
  • Kenmore, WA Real Estate
  • Kent, WA Real Estate
  • Kettle Falls, WA Real Estate
  • Keyport, WA Real Estate
  • Kingston, WA Real Estate
  • Kirkland, WA Real Estate
  • Kittitas, WA Real Estate
  • La Center, WA Real Estate
  • La Conner, WA Real Estate
  • Lacey, WA Real Estate
  • Lake City, WA Real Estate
  • Lake Forest Park, WA Real Estate
  • Lake Stevens, WA Real Estate
  • Lake Tapps, WA Real Estate
  • Lakebay, WA Real Estate
  • Lakewood, WA Real Estate
  • Langley, WA Real Estate
  • Leavenworth, WA Real Estate
  • Lebam, WA Real Estate
  • Lilliwaup, WA Real Estate
  • Lincoln, WA Real Estate
  • Lind, WA Real Estate
  • Long Beach, WA Real Estate
  • Longbranch, WA Real Estate
  • Longview, WA Real Estate
  • Loomis, WA Real Estate
  • Loon Lake, WA Real Estate
  • Lopez Island, WA Real Estate
  • Lummi Island, WA Real Estate
  • Lyle, WA Real Estate
  • Lyman, WA Real Estate
  • Lynden, WA Real Estate
  • Lynnwood, WA Real Estate
  • Machias, WA Real Estate
  • Malaga, WA Real Estate
  • Malo, WA Real Estate
  • Malone, WA Real Estate
  • Malott, WA Real Estate
  • Manchester, WA Real Estate
  • Mansfield, WA Real Estate
  • Manson, WA Real Estate
  • Maple Falls, WA Real Estate
  • Maple Valley, WA Real Estate
  • Marblemount, WA Real Estate
  • Marlin, WA Real Estate
  • Marysville, WA Real Estate
  • Mattawa, WA Real Estate
  • Mazama, WA Real Estate
  • McCleary, WA Real Estate
  • McKenna, WA Real Estate
  • Medical Lake, WA Real Estate
  • Medina, WA Real Estate
  • Mercer Island, WA Real Estate
  • Metaline Falls, WA Real Estate
  • Methow, WA Real Estate
  • Mill Creek, WA Real Estate
  • Milton, WA Real Estate
  • Mineral, WA Real Estate
  • Moclips, WA Real Estate
  • Monitor, WA Real Estate
  • Monroe, WA Real Estate
  • Montesano, WA Real Estate
  • Morton, WA Real Estate
  • Moses Lake, WA Real Estate
  • Mossyrock, WA Real Estate
  • Mount Vernon, WA Real Estate
  • Mountlake Terrace, WA Real Estate
  • Moxee, WA Real Estate
  • Mukilteo, WA Real Estate
  • Naches, WA Real Estate
  • Nahcotta, WA Real Estate
  • Napavine, WA Real Estate
  • Naselle, WA Real Estate
  • Neilton, WA Real Estate
  • Nespelem, WA Real Estate
  • Newcastle, WA Real Estate
  • Newport, WA Real Estate
  • Nooksack, WA Real Estate
  • Nordland, WA Real Estate
  • Normandy Park, WA Real Estate
  • North Bend, WA Real Estate
  • North Cove, WA Real Estate
  • Northport, WA Real Estate
  • Oak Harbor, WA Real Estate
  • Oakville, WA Real Estate
  • Obstruction Island, WA Real Estate
  • Ocean City, WA Real Estate
  • Ocean Park, WA Real Estate
  • Ocean Shores, WA Real Estate
  • Ocosta, WA Real Estate
  • Odessa, WA Real Estate
  • Okanogan, WA Real Estate
  • Olalla, WA Real Estate
  • Olympia, WA Real Estate
  • Omak, WA Real Estate
  • Onalaska, WA Real Estate
  • Orcas Island, WA Real Estate
  • Orondo, WA Real Estate
  • Oroville, WA Real Estate
  • Orting, WA Real Estate
  • Othello, WA Real Estate
  • Outlook, WA Real Estate
  • Oyhat, WA Real Estate
  • Oysterville, WA Real Estate
  • Pacific, WA Real Estate
  • Pacific Beach, WA Real Estate
  • Packwood, WA Real Estate
  • Parkland, WA Real Estate
  • Pasco, WA Real Estate
  • Pateros, WA Real Estate
  • Pe Ell, WA Real Estate
  • Pearl Island, WA Real Estate
  • Peshastin, WA Real Estate
  • Point Roberts, WA Real Estate
  • Port Angeles, WA Real Estate
  • Port Hadlock, WA Real Estate
  • Port Ludlow, WA Real Estate
  • Port Orchard, WA Real Estate
  • Port Townsend, WA Real Estate
  • Poulsbo, WA Real Estate
  • Preston, WA Real Estate
  • Prosser, WA Real Estate
  • Pullman, WA Real Estate
  • Purdy, WA Real Estate
  • Puyallup, WA Real Estate
  • Quilcene, WA Real Estate
  • Quinault, WA Real Estate
  • Quincy, WA Real Estate
  • Rainier, WA Real Estate
  • Randle, WA Real Estate
  • Ravensdale, WA Real Estate
  • Raymond, WA Real Estate
  • Reardan, WA Real Estate
  • Redmond, WA Real Estate
  • Renton, WA Real Estate
  • Republic, WA Real Estate
  • Rice, WA Real Estate
  • Richland, WA Real Estate
  • Ridgefield, WA Real Estate
  • Ritzville, WA Real Estate
  • Riverside, WA Real Estate
  • Rochester, WA Real Estate
  • Rock Island, WA Real Estate
  • Rockport, WA Real Estate
  • Ronald, WA Real Estate
  • Rosburg, WA Real Estate
  • Roslyn, WA Real Estate
  • Roy, WA Real Estate
  • Royal City, WA Real Estate
  • Ruston, WA Real Estate
  • Ryderwood, WA Real Estate
  • Salkum, WA Real Estate
  • Sammamish, WA Real Estate
  • San Juan Island, WA Real Estate
  • Satsop, WA Real Estate
  • Seabeck, WA Real Estate
  • Seatac, WA Real Estate
  • Seattle, WA Real Estate
  • Seaview, WA Real Estate
  • Sedro Woolley, WA Real Estate
  • Sekiu, WA Real Estate
  • Selah, WA Real Estate
  • Sequim, WA Real Estate
  • Seven Bays, WA Real Estate
  • Shaw Island, WA Real Estate
  • Shelton, WA Real Estate
  • Shoreline, WA Real Estate
  • Silver Creek, WA Real Estate
  • Silverdale, WA Real Estate
  • Silverlake, WA Real Estate
  • Skamokawa, WA Real Estate
  • Skykomish, WA Real Estate
  • Snohomish, WA Real Estate
  • Snoqualmie, WA Real Estate
  • Snoqualmie Pass, WA Real Estate
  • Soap Lake, WA Real Estate
  • South Bend, WA Real Estate
  • South Cle Elum, WA Real Estate
  • South Colby, WA Real Estate
  • South Prairie, WA Real Estate
  • Southworth, WA Real Estate
  • Spanaway, WA Real Estate
  • Spokane, WA Real Estate
  • Spokane Valley, WA Real Estate
  • Springdale, WA Real Estate
  • Stanwood, WA Real Estate
  • Stehekin, WA Real Estate
  • Steilacoom, WA Real Estate
  • Stevenson, WA Real Estate
  • Stuart Island, WA Real Estate
  • Sultan, WA Real Estate
  • Sumas, WA Real Estate
  • Sumner, WA Real Estate
  • Suquamish, WA Real Estate
  • Tacoma, WA Real Estate
  • Taholah, WA Real Estate
  • Tahuya, WA Real Estate
  • Tenino, WA Real Estate
  • Thornton, WA Real Estate
  • Thorp, WA Real Estate
  • Tieton, WA Real Estate
  • Tokeland, WA Real Estate
  • Toledo, WA Real Estate
  • Tonasket, WA Real Estate
  • Toppenish, WA Real Estate
  • Touchet, WA Real Estate
  • Toutle, WA Real Estate
  • Tracyton, WA Real Estate
  • Tukwila, WA Real Estate
  • Tulalip, WA Real Estate
  • Tumtum, WA Real Estate
  • Tumwater, WA Real Estate
  • Twisp, WA Real Estate
  • Union, WA Real Estate
  • University Place, WA Real Estate
  • Usk, WA Real Estate
  • Vader, WA Real Estate
  • Vancouver, WA Real Estate
  • Vantage, WA Real Estate
  • Vashon, WA Real Estate
  • Vaughn, WA Real Estate
  • Waitsburg, WA Real Estate
  • Waldron Island, WA Real Estate
  • Walla Walla, WA Real Estate
  • Wapato, WA Real Estate
  • Warden, WA Real Estate
  • Washougal, WA Real Estate
  • Washtucna, WA Real Estate
  • Waterville, WA Real Estate
  • Wauconda, WA Real Estate
  • Wauna, WA Real Estate
  • Wenatchee, WA Real Estate
  • Westport, WA Real Estate
  • White Pass, WA Real Estate
  • White Salmon, WA Real Estate
  • Wilbur, WA Real Estate
  • Wilkeson, WA Real Estate
  • Wilson Creek, WA Real Estate
  • Winlock, WA Real Estate
  • Winthrop, WA Real Estate
  • Woodinville, WA Real Estate
  • Woodland, WA Real Estate
  • Woodway, WA Real Estate
  • Yacolt, WA Real Estate
  • Yakima, WA Real Estate
  • Yarrow Point, WA Real Estate
  • Yelm, WA Real Estate
  • Zillah, WA Real Estate

CRS logoCRS logoCRS logoCRS logo

Copyright © 2023 | XML Sitemap | Sitemap |Privacy Policy

Designed by Om Spark LLC

Copyright © 2023 · Curb Appeal Evolved on Genesis Framework · WordPress · Log in

 

Loading Comments...