Purchasing an investment property is a big decision, and you want to be sure you’re making the right one. While all investments come with some risk, you can help maximize the profitability and value of your real estate investment by looking for the right qualities in a DC property.
So what features and amenities should you look for when purchasing a rental home? The following qualities and considerations can help you make the best decision for your investment in the nation’s capital.
A Great Location and Neighborhood
The location of your rental property matters more than any other factor. After all, a significant part of a property’s value is its location.
For example, if the property is close to a college campus or a popular vacation spot, you may be looking at more short-term rentals, which can yield higher rents but more vacancies than long-term ones.
Is the property in an up-and-coming neighborhood, a popular location, or one that’s not as popular? All of these have the potential to impact the value of the property over time, so they are important to consider.
When looking at location, it’s also essential to look at the area’s average rent and vacancy rates to better gauge the rental market.
Other potential factors that will determine the value of the location and the neighborhood you are considering for your rental property include:
- Nearby schools
- Jobs or employers in the area
- Crime rate in the community
- Local restaurants or bars
These are all things your potential renters will likely be looking for, so you should be looking at them as well.
Additional Amenities for Tenants
A rental property that has amenities for tenants can increase the value of your investment both now and in the future. Renters are specifically looking for properties that have:
- A home office
- Yard or outdoor space
- On-site gym or pool
- 24/7 security
- On-site parking
These are all features that tenants will pay more for, so look for a property that either already has these amenities or one that has the potential to add them.
Low Property-Related Costs Such as HOA Fees
Of course, your investment will come with additional costs besides the home itself, such as property taxes, HOA fees, landscaping, and trash removal. Considering these costs and factoring them into your property expenses can help you make a smart investment.
For example, if you can afford the property but the HOA fees and property taxes will cut significantly into your rental income, it may be worth it to look at properties with lower taxes and fees associated with them.
A Property That’s in Good Condition
It’s realistic to expect most properties to need some updating, but consider these costs and the overall condition of the property before purchasing.
For example, if the building or home you are considering as an investment property is a historic one, you could be looking at additional costs beyond what you expected to spend.
A property that is in good condition and that you expect to have minimal surprises when updating can help you get your investment up and running with minimal cost and effort for renovations.
Make Your Best Choice With FAS
Considering purchasing an investment property in DC? If so, FAS Management can help you make the best decisions for your investment for long-term profitability. Contact us today to learn about our property management services for investors in the nation’s capital.
