The investment market in Greater
Lansing is hot right now. With students from MSU flocking to find off campus
housing in downtown East Lansing, there is fantastic opportunity to have a
profitable investment property in the area. The important thing is to do your homework before jumping
in.
A good first step is to look into
your area. A seller can downplay negatives about an area, or over embellish how
many students look at that area. Therefore, it is necessary to look into it
yourself. Check the rental listings for the neighborhood and drawn your own
conclusions as to whether student budgets could meet them. If the area you are
looking at has an average rental rate of $1200 per person, and a nearby area
rents for an average of $500 per person, more students will probably flock to
the cheaper area more often. You
can also talk to neighbors about the area. They have lived there for a while
and have seen who comes and goes. Keep in mind that you can also confirm any information
that you are worried about with your Realtor.
It’s also important to keep in mind
how you plan to manage the property. If you will actively manage it yourself,
you may want a property that’s reasonably close to where you live. This way, if
issues come up with tenants or small repairs are needed, it won’t be a hassle
to make a trip. If you are going to have another person or a management company
manage it, the proximity to your house will be less of an issue.
In the end, you will definitely
want to make sure that you have someone who can help you with several different
aspects of the investment property transaction. It’s critical to find a Realtor
that is well versed in the guidelines and restrictions around licensing (like
myself), to make the transition to rental property owner a smooth one (see my post on rental licensing). It’s
also beneficial to work with someone that specializes in investments and has
possible additional knowledge or certifications in this niche (which I do). So,
if you would like to look into your first rental property or your fifteenth, I
would be happy to speak with you.
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