Everything You Need to Know about Investment Properties

Everything You Need to Know about Investment Properties

One of the first considerations to make is your budget, which you can help decipher by consulting with a Vancouver mortgage broker. Keep an open mind when looking, or the process can take much longer. However, there are various factors to assess that can help you avoid making a risky investment.

Location is an important consideration because you will want the property to be relatively close to your home if you are going to manage it yourself. On the flip side, if you plan to hire a property manager, the whereabouts of the property are not as significant. Geography is relevant either way, however, if you want to attract a specific type of tenant. Be mindful of the demographics of any particular area when you choose an investment property, as most people will fit the stereotypical mould.

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As with a home you would be looking to live in yourself, factoring in the cost of property taxes and a ballpark estimation of expected hydro and maintenance costs is also very helpful when exploring prospects. A mortgage broker in Vancouver can help you understand these financial aspects more clearly. Keep in mind the total rent you would need to charge tenants given all the circumstances and if the average person in the area could afford it. Average rental costs in the area are important to consider as you will want to be competitive with other properties. It can be risky if you do not have enough interest from renters and cannot make any profit.

Another hidden factor to research is future developments planned for the area that would be surrounding your potential investment property. Additional amenities are likely to add value and interest from potential renters, but too many additional residential homes could evoke too much competition. In general, take these aspects into consideration when deciding what to purchase. A Vancouver mortgage broker will factor in all financial matters when considering your approval limit.

Do a quick search of the area to see how many listings are already available in the neighbourhood and whether the number is due to popularity or lack of popularity. Another important consideration is how the location is reputed, including its crime statistics. Furthermore, consult insurance companies for any variances in different areas you may be exploring with regards to the rates they will charge you.

Depending on the demographics, it is also likely important to consider the proximity to the nearest elementary schools, high schools and universities. Their ratings and reputations are relevant, too, not to mention other potential close amenities, such as gyms and grocery stores, access to public transportation, parks, shops, and so forth. These items can certainly help to add value when you seek to rent out your investment property and hopefully earn profits to make it all worthwhile. Speaking with a mortgage broker in Vancouver can help you understand the financials.