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Apartment Rental Property Tips for Investors

by Jason on October 15, 2010

Have you thought about buying investment property?

Interest in renting out investment property, like apartments, is gaining because of depressed real estate prices.

Investing in the right apartment can be a great way to make money, but the wrong investment can lead to big losses.

Before you look at even one investment property or apartment you should know what makes a good rental and how to decide which one best suits your needs.

Investors like the idea of buying apartments over buying houses because the start up cost is usually much lower.

Apartments also have the added advantage of being a bit easier to maintain. Without having to worry about a lawn and often with maintenance costs built into the price they are an investors dream come true.

Low cost and little hassle makes along with a big investment return makes them virtually a win-win situation.

However, before you go out apartment hunting you should know which kinds of apartments are going to give you the most for your money and how to determine the rent-ability of a particular space.

Apartment Hunting Tips

Investment Property Tip #1 – Pay attention to location.

In most cases you are going to have a better chance at renting an apartment that is close to amenities that make living in the city easier.

Look for places that have close access to public transportation systems, shopping outlets, and restaurants. Most of the time apartment dwellers are young and without children so proximity to schools is not a top factor.

Although you want your investment apartment to be in a great locale, you want to steer clear of main roads.

Opt for places on side streets because they will be less noisy and more appealing to renters.

Investment Property Tip #2- Size does matter.

An apartment in a big complex may be more expensive to run because it will have more facilities that need to be maintained like gyms and pools.

This may mean that you will not make as much profit on your rental price. However, those amenities might make your apartment more appealing to the right renter.

On the other hand, older apartments are cheaper to maintain and tend to have a bit more character which would also be ideal for the right buyer.

The best thing to do is to evaluate each apartment based on comparisons of similar apartments in the area and choose the one that will give you a big return.

Investment Property Tip #3 – Find rentals you would live in.

It sounds counter-intuitive but if you seek out apartments that are appealing to you then you then they will likely also be appealing to renters.

Most of us want an apartment that has nice laundry facilities or hookups inside the apartment. A parking space is a huge plus in most city apartments and one that your renters will be willing to pay extra to get.

We also want nice views, a good layout with lots of storage, and plenty of natural light. Remember that what is appealing to you will probably be appealing to others too.

Investment Property Tip #4 – Watch out for potential maintenance issues.

In many cases regular maintenance will be included with the building. However, more expensive fixes like an elevator repair, building painting, or parking lot resurfacing could be charged back to you.

If you still want to buy a place that has these potential added maintenance costs make sure you can add a bit to the rental price to set aside a fund to pay for them when the time comes.

Investment property, like apartments, is a good way to get into the real estate game.

With some smarts you can get a great place that will allow you to make some extra money so that you can continue to build your real estate empire.

On the other hand, making a bad apartment choice can quickly land you in the poor house with a pile of debt and an apartment that no one wants. Choose wisely and do not settle until you find the perfect investment apartment.

This article was written by William Eve. William writes about saving money, property investment and real estate for Home Loan Finder.

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