Do you want to invest in Detroit real estate? Check out these 7 tips to invest in real estate like a pro!
Investing in Detroit real estate is an incredibly smart decision. Whether you are a seasoned investor or just starting out, there are certain things you should always do to make sure your investments don’t hit a snag. By utilizing these tips, you will be able to invest with confidence!
Tip 1 – Make Your Lease Iron Clad
And stick to it. Don’t allow tenants to begin paying late or getting away with things you wouldn’t want to see on a regular basis. You lease should cover a wide range of situations and scenarios. You want to be prepared for anything so there are no disagreements about who is responsible for what. You can find a number of boilerplate lease agreements online, however, you should always speak to your lawyer and present them with your final draft. They will be able to review the legalities and help you find anything you may have missed.
Tip 2 – Diversify
Don’t just consider property in an area you like. Consider properties in a wide range of areas to increase your odds of finding a great deal. Furthermore, look at many forms of investment real estate. Do be afraid to consider single-family, multi-family, and even commercial investments when looking to maximize your portfolio. The best and most profitable portfolios have a wide range of different properties.
Tip 3 – Screen
Don’t let anyone move in to one of your properties without having a full background check done. No matter if they are a friend, relative or wife of your tenant, you need to have it in writing that they will be a good tenant. This isn’t personal, it is your business and many landlords kick themselves for not adequately screening, then finding themselves stuck with a bad tenant. You can run the background check yourself, or hire a professional company to handle it. Nothing ruins an investment property faster than a bad tenant. This small cost upfront, is nothing compared to the repercussions of are of having a bad tenant occupying your property!
Tip 4 – Regular Maintenance Is Critical
Just like you visit a doctor for an annual checkup or take your car in for a tune-up, your properties need to be maintained as well. Regular maintenance will help you catch problems before they get out of hand. Ask your tenants to let you know right away of any needed repairs or necessary maintenance. Make sure to schedule walkthroughs of the house to make sure everything is in working order.
Tip 5 – Don’t Make It Too Nice
Of course, if you are providing a home for tenants, you want o to offer a fully-functioning, welcoming place for them to call home. That said, this doesn’t mean you need to renovate the whole house, add expensive flooring or replace all the appliances. Keep things simple, and don’t redo things based on your taste, but rather be practical and purchase things that are not only functional but also durable enough to handle the cycles of many tenants coming through.
Tip 6 – Set Goals
Your investment property needs to be providing you with solid returns plain and simple. Set goals for every property in your portfolio. If they are not performing at the level you require, ask yourself why. Does the house need some upgrades to keep it competitive with other rentals out there? Or maybe you aren’t doing enough homework and are repeatedly finding yourself stuck with bad tenants. It is important to determine where you are going wrong so you can take corrective action or sell the property.