Before You Buy Rental Property in Chicago
If you’re considering buying rental property to increase your portfolio, there are a few things you should keep in mind. Rental property can be a valuable and profitable investment if you do it the correct way. Whether you choose to hire a property management agency in Chicago or if you choose to go it alone, here are five things you should take into consideration.
Remember the 1% Rule of Thumb
Anyone who has ever invested in property will tell you to remember the 1% rule. This is that your property/investment should give you a 1% return on investment. If not, then you may need to consider another location. For example, this means if you pay $200,000 for a property, it should bring in no less than $2,000 a month for you. The only reason you should ever consider buying a property without this ROI is if the neighborhood is in a constantly changing atmosphere. This could mean later down the road the property income will increase.
The Condition of the Property in Mind
Make sure to get a good inspection of the property you have in mind. What type of upgrades or repairs will you have to do? Is it a turnkey property? Will you have to put a significant investment into getting it ready to rent? By having a complete inspection done on the property you can avoid some tough situations down the road.
Where is it Located?
While you’re considering investment property, make sure to check out the neighborhood surrounding the property. If the location is not in a good area, it won’t matter if you have the best Chicago property manager in the city. People want to feel safe and secure in their home.
Don’t Forget Unexpected Emergencies
Make sure that you are prepared for any unforeseen emergency such as a major appliance going out or the HVAC system needing to be replaced. This is part of your investment when you’re buying a rental property. It is important that you have a property management company in place to help you maintain service on the property and handle any small repairs quickly before they turn into costly repairs.
Insurance and Property Taxes
This is part of your investment you’re making. Consider the insurance on your Chicago condominium as well as the property taxes you’ll have to pay. You want to make sure that your investment is still going to give you a good ROI no matter the cost of these two big-ticket items.
One way to easily take care of all your rental property in Chicago is with a property management team such as the Connected Management company. They specialize in small to medium properties and can help you to take care of all the ins and outs while you’re growing your portfolio. Be sure that if you’re a first-time property investor you discuss your options with their experienced team. They can assist you with all your Chicago property management needs so you can continue to grow your investments.