It's always a bit nerve-wracking buying your first rental property as a newbie investor. But taking this first step is crucial because it will teach you so much about the market you are investing in, and your second rental property will be so much easier to purchase.
There are certain steps you need to follow when learning how to buy your first rental property. If you follow these steps, it should ensure that you don't end up losing money on your rental property or making some other enormous blunder. Keep reading to find out more about how to become a landlord for the first time.
1. Don't Use Fear or Greed as a Motivator
The first thing to keep in mind when investing in rental properties is not to let FOMO or greed run your decision-making. It's about crunching the numbers and doing what's best for your particular situation, not running after some property and paying way too much because you are worried about missing out on potential profits.
2. Check Rental Property ROI
Always, always, always figure out what the rental property ROI is going to be before investing in rental properties. You want to purchase a property that will have positive cash flow and will give you profits year after year rather than sucking your savings dry.
3. Get Advice From Other Landlords in the Area
You are not alone in this business. There are probably many other more experienced landlords in the area who would be happy to give you advice on how to become a landlord for the first time. Take them out for coffee and pick their brain on whatever worries or confuses you about buying rental properties.
4. Choose the Right Location
If you can choose a rental property in the right location and at the right price, 90% of your battle is already won. That's why you will want to do your due diligence in figuring out which area is best for rental properties before dipping your toes into it.
5. Use a Property Management Company
There's no way you can do it all as a landlord, especially if you don't want to limit yourself to one or two rental properties. Get a San Francisco Bay Property Management Company as soon as you can, so you can free up your time to purchase new properties rather than taking care of old ones.
How to Buy Your First Rental Property - Slow and Steady
There is no rush when it comes to learning how to buy your first rental property. If you need more time before purchasing your first one, then don't worry about it and take all the time in the world.
Once you become a pro at buying rental properties, you will be buying them left, right, and center.
If you are still searching for a property management company in the San Francisco Bay, California area, then we are here to help. Contact us today to see how we can assist your dreams of becoming a successful landlord.
Evan has been in the real estate and property management field for 6+ years. He is experienced in working with first time home buyers, is an Accredited Buyer’s Representative (ABR®), Seller Representative Specialist® (SRS) and Seniors Real Estate Specialist®(SRES®). He also works closely with Kenny Realty owners, getting their rental properties rented as quickly as possible. Evan is responsible for monitoring rental market conditions and advising our owners on market rates. He has outstanding communication with all clients he works with, keeping everyone in the loop at all times. He is the third generation of the Kenny family to practice property management on the peninsula.