Renting out properties is one of the most profitable markets to get into in the modern day, but that is only if you know the right things to do. You don’t just rent out any property, they have to have certain features. But how do you know which ones will bring you the most income at the end of each year?
We’re here to show you the top 12 features of a profitable rental property so you can get ahead before you even get started.
A property worth your money
There’s no point renting out a property if it’s not going to make you a profit. Before you even purchase a property, you want to ensure that you purchase it for a reasonable price and rent it out for an amount that will get you your investment back quickly.
What you don’t want to do is purchase a property at an extortionate price and then realise that the market is so competitive that you can only get tenants if you lower your rental price. This will mean you won’t make any profit and set yourself up for failure at the beginning.
What’s one thing you look for when either renting or purchasing a property for yourself to live in? You look at the area it’s in! Therefore, if you want to start renting out properties yourself, you want to purchase ones that are in a high-demand and safe neighbourhood.
You may have to do a little research for this to figure out what neighbourhoods are best, but it will be worth it in the long run.
An area that is safe
No one wants to live somewhere they don’t feel safe, so you don’t want to purchase and rent a property in a high-crime area. You want to find somewhere safe, which is known for this as well.
But how do you do this? It is probably best to look up crime rate statistics in the areas you’re looking at buying in and then choose the area with the lowest rates.
Good network of transport
Unfortunately, not everyone has a car that can get them to where they need to be, so many people are looking to rent a property close to various modes of transport. Whether it’s the underground, buses, or overground train, you should ensure at least one good network of transport is near the property for your future tenants.
You don’t have to provide the finances to fund their transport, but you can increase your rent prices and make more in the long run.
While you can’t control the weather, you can choose to invest in a property with a favourable climate. Many people enjoy warm and sunny days, so you should look into areas with this type of weather and consider purchasing a property there.
This may not be as relevant for long-term rentals, but for short-term and holiday rentals, people will certainly be looking at how the weather is.
Affordable average rents
Most people who rent properties don’t have the finances to purchase their own homes or are looking to save to buy their own. Due to this, they are going to look for an affordable place. If you want to get a tenant into your property quickly and start making a profit, you want to purchase a house in an area with good rent prices. It should also mean that your investment won’t be too much to begin with as well.
Good quality schools locally
Depending on other factors, you may want to rent out a property in a good school district. For example, if you’re investing in a home in a good neighbourhood with low crime rates, chances are that families are going to want to move there.
You can often look up how close the nearest schools are and how they have been ranked by the school boards. You want ones that people say good things about online, then look at properties nearby.
Favourable property taxes
While a property is an investment, if you want it to be highly profitable, you don’t want to keep paying too much once you’ve bought it. Alongside the property's purchase price, you will also have to pay property taxes. These can seem like a bit of a burden, but they don’t have to be if you find a house with favourable property taxes.
This will take a little research, but comparing and contrasting property tax rates is good before you decide on the house you want to buy.
Attractive job market
Unless someone is moving to the area because they already have a job offer, they will want to move somewhere with many job opportunities. Look on hiring sites and see if there are many jobs available in the area you are looking at, as well as what the average yearly income is as well.
Lots of amenities
If someone is going to rent a property long term, they aren’t going to want to be bored the entire time they are living there. That’s why it’s good to check that there are a lot of amenities and things to do in the area.
This can be anything from a good stream of shops to gyms, arcades, and grassy outdoor areas. Sites like TripAdvisor are good for looking up amenities and helping you decide if it's the best area to buy.
Natural disaster-free area
We’ve already mentioned safety as one of the top features for renting a profitable property, but this doesn’t just mean crime. People want to be sure that they live in an area with few natural disasters, such as floods, hurricanes, and earthquakes.
Look up the history of natural disasters in the area you wish to start renting from and ensure that there hasn’t been anything huge in the last few decades.
You don’t want to start renting in a ‘been there done that’ area because then there are no chances to grow. People are always looking for the next best thing with future development opportunities, so you want to look at purchasing in a place that has a lot of spare space and developments planned.
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