Investing in Your First Rental Property
From a financial perspective, you need to evaluate both unexpected and expected expenses.
• Down Payment: 20% minimum of the property value
• Closing Cost:
- Loan Fees
- Appraisal Fee
- Broker/ Real Estate Agent Commission of Fees
- Attorney or Title Fees
• Home Inspection: $500
• Property Taxes
• Maintenance and Repairs:
• Vacancy: Prepare to pay for your mortgage and expenses for a period of time without a tenant
The next piece is the work associated with ongoing property management, including tenant screening, rent collection, maintenance, etc. You essentially have three options:
• Utilize a property management software
• Hire a property management company
If you have your finances in order and have a game plan for the management tasks, then it makes sense to purchase an investment property. Remember to consult your counsel for any personalized legal or financial guidance.