What Does A Real Estate Investor Need To Decide When Investing In A Property?
In 2016, the city of Charleston, South Carolina, was ranked as the fifth best place for real estate investment in the U.S by HomeVestors and the Local Market Monitor. This ranking was based on the employment growth rate of different cities across the nation. Although it mainly concerns rental properties, it is one of many clear indications of the importance of investing in real estate. The first question one then may ask when considering investing in real estate is what does a real estate investor need to decide when investing in a property? From this, a common objective unites the greater and more knowledgeable real estate agents in Charleston; which is to assist you in coming up with innovative solutions for all your real estate investment needs.
Real estate investments are considered the most stable and secure long-term investment strategy, and it is important to consider other factors that will affect your capability to maximize returns. Having adequate knowledge of these factors (and the right real estate agent to help you) will enable you to make logical decisions and to capitalize on the fullest potential.
Factors to Consider When Investing in Real Estate Properties
As with any investment strategy, real estate has two sides; the buyer’s side and the seller’s side. Whether you are looking to diversify your rental portfolio, acquire, improve and sell distressed properties, or looking for a second property; it is important to consider both factors. Other questions you could be wondering include What to Look for When Buying an Investment Property in Charleston, SC or Should I Sell My House First, Or Buy a New Home First?
These details below will help you to make an informed investment decision that will give you good returns. Some of the most important factors to consider when investing include:
- Market availability
This involves considering the economic viability of property in relation to the prevailing market conditions. If you are a buyer, it is important to have comprehensive knowledge of all properties that suit your needs and then narrow them down accordingly. Selling in a market with no buyers will just waste your time.
However, for both buyers and sellers, be sure to have extensive comparative market analyses that will help you know the actual value of your prospective investments. This will enable you to consider all options, and get all the information required to close the right deal successfully.
- Expenses and returns
This is probably the next most important factor to consider after market availability. It includes the costs incurred during the acquisition of the property, as well as those incurred if it requires any renovations. This also includes items like property tax, insurance costs, and even income tax (depending on how the deal is structured). When considering the returns, you’ll also look at the rate of appreciation if you are going for a resale in the near future. Comparing the expected expenses and profits will allow you to make a meaningful and well researched investment decision.
- Actual property and location
It is important to have this in mind because there are many prime locations in Charleston such as the Charleston Peninsula and Upper King Street. However, other places in Charleston are sometimes troubled with unstable grounds and heavy flooding. These factors will negatively affect the value of the property and the ability to resell. The objective of property investment is to get good returns, and if this is not achieved then the property adds no benefit to your portfolio. Following through on proper data and research is vital, which makes knowing a knowledge real estate agent that knows your overall market vastly important.
These allow for your legal protection through insurance, house inspection, and corporate structuring. It is important to have an expert or your attorney advise you through the whole process so as to have a full list of options in case any unexpected circumstances arise.
Real estate investment in Charleston is a very lucrative venture. Nonetheless, it is crucial to consider a full range of options that will positively influence the investment process in your favor. It will enable you to make sound investment decisions and to maximize returns to their full capability.
Be sure to have a knowledgeable realtor that really knows the market.