Many people who are eager to invest in property in order to become landlords make two basic mistakes before they ever actually see a realtor. The first mistake that is commonly made is to assume that rental properties are going to provide you with an extra ongoing income every month.
In some situations, it is true that you may make a small amount of money, particularly if you pay more than thirty percent of your mortgage in your initial investment, from Austin tenants who pay to rent your house. However, that is not the best reason for investing in property in Austin. The real objective should be to make a long-term commitment to purchase and keep your home over time while its value appreciates, and resale it down the road.
The second mistake that people make when making a property investment is to choose a location poorly. One might consider a new development or an area in Austin where to rent a house is common and popular as being full of potential, and it might be the case.
However, less established neighborhoods present more of a risk, and areas in which rental properties are ubiquitous mean more competition as well. If you invest in a location where the property is not appreciating well or where the quality of tenants is not up to par with baseline expectations, you may wind up spending far more money than you initially planned and may not get back the full value of your investment over time.
Before you invest in Austin or rent a house to tenants look for properties in neighborhoods where people want to live, neighborhoods that are well established, and where you will find the best kinds of tenants. These are more likely to not only result in less cost during the duration of your investment, but also to gradually appreciate in value so that you make a profit on your property over time.
This is likely to be more profitable than seeking cheaper properties in the hopes of securing positive cash flow in the short term. The basic principle to keep in mind is that of delayed gratification. If you delay any expectation of making a short term profit proceeding from rent from month to month, you are likely to yield a higher value once values appreciate and it is time to resale.
Avoiding these mistakes means perhaps making a less risky investment with lower positive cash flow in the short term, but a higher expectation of making more money on your investment than you otherwise might have in the long-term.
Austin Rent House – TEXAS INCOME PROPERTY (http://www.texasincomeproperty.com/) has been a leader among Austin property management companies in Greater Austin and the surrounding communities since 1979. Realtors in Austin trust the extensive experience of our knowledgeable staff. Texas Income Property offers property management in Austin, Texas and the surrounding metro area that is among the very best in the real estate industry. Investing in an Austin property to rent a house or duplex for appreciation over time can be profitable. Contact us today for more information. 105 W. Riverside Dr., Suite 110, Austin, TX 78704 | 512-495-9400 | info@TexasIncomeProperty.com