Do’s and Don’ts for Investing in Real Estate

  2021 may be the perfect year for you to purchase a rental property, vacation home or even flip a house. In this post, I've put together a list of tips and tricks for you to get the best return on your investment.

Firstly, consider what type of investment property is best suited for you. If you are considering a rental property like a vacation home, consider how much time will be needed for things like maintenance, managing a website with rental listings and vetting potential tenants. Make sure the areas that you're searching in are attractive to tenants in terms of proximity to business centers and transportation hubs. Also, be sure to read any and all rules pertaining to owners and guests, as well as rules on renting your property out when you're not staying in it. 

If you’re interested in flipping a property, you want to be able to find out what the return on your investment is expected to be based on the area you’re looking at. Talk to suppliers and contractors and get realistic estimates on renovations, both in terms of price and time to completion. 

Below are a list of some additional Do’s and Don’ts for investing in real estate:

1. Do aim for at least a 15% return on your investment.

2. Don’t Purchase a second, or third property until the first one is earning revenue.

3. Do look for houses priced on the lower end of the median range.

4. Don’t purchase a property you cannot afford to carry for several months in the case of a slow market.

5. Do focus on one specific neighborhood, or area.

6. Don’t buy without having an inspection performed.

7. Do purchase properties close to your home if you plan on managing them yourself.

8. Don’t buy a property without title insurance!

9. Do use ONE real estate agent to help you with all your buying and selling needs.

10. Don’t overwhelm yourself by buying more properties than you are able to manage personally.

Some people make the mistake of contacting multiple sellers and listing agents directly. Working with multiple people is a waste of your time and increases the chance that you WILL miss out on a deal. Working with one agent allows them to learn your tastes, needs, and specific parameters so they can be out looking for the right property for you while you're busy doing other things.