Owning a rental property can be daunting and expensive. However, you can purchase your first Kirkland rental property in a short time with a calculated approach. Having a rental income to supplement your income can be beneficial to getting closer to your life goals. Below are the primary elements for locating and buying your first rental property.
Collect as much information as possible regarding the place you intend to invest in. Search for standout features of the area that could entice tenants, such as proximity to public transit, a park, shopping, or a beautiful view. You should also read up on the tax laws and mortgage rates so that you can get a good estimate as to how much you should prepare for your future investment and cash needed as down payment and mortgage costs for your first Kirkland rental property.
When aiming to finance, there are various types of options you can utilize. Rental property loans or finance options can differ from those available to owner-inhabited home mortgages. Here are some different types of financing options you can use:
- Cash – use cash to acquire a rental home
- Mortgage – pay a down payment and then monthly mortgage payments
Note: there are many types of mortgages; do your homework to ensure the loan suits your needs and finances
- Portfolio lenders – get hold of an adapted portfolio of mortgages available with flexible terms specific to property owners
- Federal Housing Administration (FHA) loans – while FHA loans are meant for those planning to live on the property, there are a couple of options available with FHA that allow FHA-financed properties to have more than 1 unit (up to 4); you could live on the property while also having a rental property unit using FHA
- 203K loans – this loan works into the loan amount the cost of home repairs and improvements; this can be useful when looking to do a home renovation and then rent the home out
Find a Property
Connect with a real estate agent local to your targeted area to see where there are properties available. Have a general idea of the property’s specifications and your spending budget. Make sure to set limits and expectations when property searching. If you get the right purchasing point, you can then determine your long-term profitability.
A vital part of the process not to be missed is to have the property examined to determine if it is livable and what has to be repaired or replaced to make the home rent ready. Prior to buying, you can ask a Real Property Management office to evaluate the rental property to give insight regarding its rentability and to give suggestions for upgrades and so on. They can also recommend a certified home and pest inspector should the need arise. You should be able to figure out an estimate as to the property’s current and potential performance within this critical step.