A home is one of the biggest investments that you are likely to make in your lifetime. Yes, that’s right. You heard me. Your home is an investment. Every month you pay money towards your future in each mortgage check. This is why you want to do everything you can to ensure you get a good return on your investment. After all, when you retire, you may just want to cash in and downsize or move to the coast.
When choosing a home as an investment, the most important factor to consider is the home’s location. You can change a lot about a house, but it is difficult to change the location.
Perhaps, you know of an in-demand neighborhood where the values are high and prospects look good for the future. Such a neighborhood would be a good choice for an investment. However, you may not want to choose the nicest house in this neighborhood. After all, a home without all of the bells and whistles will cost considerably less. Plus, the features can be added in later to suit your taste.
Additionally, a home without all of the features buyers look for in a neighbourhood where values are high will attract fewer buyers. This means that you will have less competition when making your bid for the home. If the house has been on the market for a while, it is even better for negotiating the sale price downward and adding in other concessions.
In conclusion, buying an undesirable house in a desirable neighborhood is a great way to buy into an otherwise unaffordable area. Additionally, the in-demand location will help maintain your home’s value down the road.
Keep In Mind: The Three Rules Of Property Investment
- Buy Low – Buying low means that you can turn an instant profit. Buying a property for under its market value can be done with foreclosures, short sales, and through negotiation.
- Sell High – Selling a property for top dollar can be done through the use of excellent landscaping, home staging, and diligent cleaning and maintenance. Attracting more buyers through these techniques puts you in a position to sell your home over market value.
- Increase Equity – If you take out a mortgage to finance your home, you are increasing your equity with every mortgage payment. The more money you have in equity, the bigger the payoff when you sell your home. Putting more money down from the beginning allows you to enjoy more equity in your home and spend less each month on interest.