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One of the most common things that many financially free individuals do is invest in rental property. However, as not all rental properties are the same, there are factors needed to be considered when choosing a property to invest in. Investopedia.com lists the following:
• Neighborhood. The type of neighborhood a rental property is located in can influence what kind of renters or tenants it can attract. Rental properties in the city, especially those near offices and commercial areas, usually attract professionals and seldom have vacancies. Areas near colleges or universities usually bring in students or professors, and are usually vacant during summer and holidays when students usually head home to spend time with their families.
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• Schools. The distance of a rental property to a particular school, as well as the reputation of that particular school, can also influence rental prices.
• Jobs. One of the many reasons why rent is more expensive in the city is because it is where most jobs and offices are located. And because there are more people who want to live near their workplace to lessen the stress of traveling back and forth, rental properties in those areas always attract more people and see higher rental prices.
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• Natural disasters. Rental properties in or near these areas should be scrutinized properly, as some of them may be water-damaged or have structural problems due to earthquakes. Also, it is important to remember that rental prices in these areas may be lower than those in less natural disaster–prone areas.
Based on this information, the most important factor in choosing a rental property is, as the saying goes, “location, location, location.”
More information on real estate investment can be found at Esplanade Capital’s website.
