Published July 9, 2010
Investing in an apartment is a tried-and-true technique for improving one’s financial portfolio. But apartment investing has certain risks attached to it. Maintaining your apartments in good condition and, at the same time, having these properties rented can be quite stressful. If you have a great location, and your market is good, there will be plenty of renters coming your way. If you are brave enough to face all these risks, the rewards of investing in apartment buildings will come in multitude.
Here are some tips to help you invest in apartment buildings:
- Advertisements. Look in newspapers and online ads for apartment buildings for sale.
- Communication. Visit each building you might want to invest in. Communicate with each owner and try to assess if he is a motivated seller. Find out their asking price.
- Inquiries. Inquire about the following: occupancy rate, rent and size of each apartment, gross income of the building in a year, expenses and loan payments for the previous years.
- Research. Use the same information as basis for researching neighboring apartment buildings.
- Compare and contrast. Compare and contrast your researched numbers with the information for your preferred apartment buildings. Assess the potential improvements of the apartment building.
- Apartment price. Determine how much the price of the apartment building is by using an appraiser. Decide on what you are willing to pay. Always consider an apartment that’s lower than your final price.
- Investment loans. Get an apartment financing loan. Present your offer to the building owner. If the owner doesn’t accept your initial offer, negotiate the price with him.
- Improvements. When you have made your final purchase, assess the management company in charge of running the apartment building. Improve the facilities and appraise the rents. Lastly, discover additional ways to perk up your profits.
Follow the above-mentioned tips and you’ll surely be on your way to a successful apartment building investment. Call Apartment Loan Store to begin the easy pre-approval process for your multifamily loan today!