How to choose the best investment in the right neighborhood
The real estate business requires a lot of resilience and risk bearing because it is associated with certain risks which can decimate your returns. The reward an investor gets from investment properties is determined by the choice made. It is therefore wise to do diverse research to keep abreast with the industry trend and be ahead of the nitty-gritty associated with real estate investment. Carrying out this research will help you determine some of the factors you need for your property such as type, location, size, neighborhood, and amenities. As an agency we offer property advisory services to investors, carry out rental assessments and conduct market surveys.
The following top 5 features are key for a profitable rental property:
Neighborhood: An investor should be strategic in choosing the right neighborhood. Think strategically by asking yourself the following questions; What is my target audience? What type of audience dominates your neighborhood? Does my rate attract the right neighborhood?
The type of clients you attract and the vacancy rate will be determined by the neighborhood. If you buy a property near the university your potential tenants will be students.
Security and Safety: When investing in property, safety is key because no one would want to live in a neighborhood that is prone to criminal activity. An investor should be as specific as possible, so, go ahead and enquire about the security of the place, and the frequency of police presence in your neighborhood.
Job Market: Locations with growing employment activities attract more tenants. If a company opens a branch in a certain locality, you can be sure the employees transferred to that area will be in need of accommodation and they will flock there. This will be a good opportunity in the neighborhood.
Future Development: Watch out for constructions going on, which implies that it is probably a good growth area. New developments could affect your property’s prices and also promote stiff competition due to additional housing.
Natural disaster: As an investor, you need to consider if an area is prone to flooding, earthquakes, earth tremors, drought, etc so as to ensure you have an insurance cover which is an expense you will have to deduct from your returns.
Amenities; In real estate, there are different types of buyers, there are people who are specific about the features of a property. Tour the neighborhood and check out the parks, swimming pool, restaurant, gyms, public transportation links, etc.
Average rent: An investor should ensure that any property considered bears enough rent to cover the expenses. Conduct detailed research to gauge the future of that specific area. This is to ensure no bankruptcy occurs in case the taxes increase.
Conclusion
Was this helpful? Remember, financial feasibility is key in property investment. Rokay Ventures Ltd provides real estate solutions in relation to all aspects of property development.
