What to Look When You're Buying an Investment Property

Jennifer Zheng

REALTOR, Abacus Properties Inc.

16870 West Bernardo Drive, Suite 400
San Diego, CA 92127
Cell #: (858) 344-8478

BRE License #: 01450123

Email: jenniferzhengrealty@gmail.com

Blog: http://jenniferzhengrealty.blogspot.com 

My service, service for Life

CALL ME today @858-344-8478, I'm a REALTOR and an experienced investor myself.

Using a Realtor
When your a new investor using a realtor is almost mandatory since you can use their experience, contacts, and knowledge to help you find the best deals.

Although realtors normally charge a total of 5% the buyer includes that fee into the sales price. Your realtor won’t get the full 5% since it’s divided 4 ways between the listing and selling real estate agents and brokers for which agents work for. So don’t think that the real estate agents are making huge commissions on these deals.

Remember they have to pay for their own gas when showing property, their annual real estate licenses, and all the rest of their overhead costs.

They are constantly dealing with buyers that never buy a house and waste their time showing prospective property. It is important to realize this since real estate agents are considered independent contractors.

Have a little compassion and don’t waste their time if your truly not interested in buying property. That being said, you need to find a realtor that OWNS investment property themselves.

Most agents only deal with buyers that are looking for a house to live in themselves and they have little to no knowledge in dealing with rental property.

What your looking for as an investor is a realtor that owns rental property themselves. They will know what to look for in a investment property and their knowledge is very valuable to an investor.

They can save you a lot of money by avoiding property that will have issues as an investment property. Interview and actually have the potential realtors show you several properties first.

The really valuable realtors will be pointing out the pros and cons for each property.
This is the type of realtor you should select for finding investment property.

Finding Property
Ok, now that you have your financing and realtor selected it’s time to get down to business. Finding the right property is crucial to making money in real estate.

There are some important points to know:
1. Don’t Buy In Expensive Neighborhoods - Nice areas may have nice homes but they don’t make sense as an investor. By the time you pay the higher mortgage payment, taxes, and homeowners insurance your left with little to no income.

Unless you have enough cash to buy these higher priced home avoid them at all costs since the risk is to high for rookies.

 2. Don’t Buy In Cheap Neighborhoods
Although there are many great deals in the worse areas your tenant pool will be bad. The
tenants that pay won’t stay long while you will be spending your days in court evicting the non-paying tenants. Drugs, murders, and other crimes will cause any potential capital appreciation to the property to be wiped out. Not only will your properties not make much income but their value will likely decline as well.

 3. Buy In Average Neighborhoods - The best deals in real estate are often in working class areas. These are neighborhoods that tend to have decent tenants and hard working people.

Many of the homes for sale may be foreclosures or homeowners looking to upgrade. Since there isn’t a huge demand for these properties you can get some great deals.

Homes in these areas can appreciate rapidly if a more affluent crowd starts to move in. Your potential tenant pool will be large since the rents are more affordable and the quality of the tenants is respectable.

Once you have located several areas that meet your buying criteria your going to want to
take a look at the inside of the properties that are for sale.