Buying an apartment building is a great way to invest in commercial real estate. They are one of the easiest ways to invest, but also very risky. Make sure you know all the codes and laws that are involved in the process. Once you have done your homework you will find that investing in apartment buildings is a great way to go.
Thinking about investing in commercial real estate? Why not consider buying an apartment building? An apartment building can be an ideal way to invest in the real estate market today. An apartment building in a good location can earn you a high yield on your real estate investment.
Location is the most important aspect when buying an apartment building. Buying an apartment building in a destroyed area is not a good idea as the renters that you will get may not be able to pay the rent on time, if at all. Apartment rentals are one of the easiest ways to invest in commercial real estate but it can also be very risky.
When buying an apartment building, check out the area and make sure that it has amenities that make it a desirable place in which to live. You also need to make sure the apartment building is structurally sound. An inspection of the property by a qualified real estate inspector is essential. If there are any repairs to be done on the property, it is best to know what and how much it will cost prior to purchase.
You also have to decide who is going to make the repairs on the apartment building. Some investors offer a discounted rental rate to someone who is willing to maintain the building. Most of the problems that are encountered by renters are easily solved with a bit of home maintenance knowledge.
To really save money when buying an apartment building, live in one of the units yourself and rent the others out. This way, you can end up paying off the mortgage on the building as well as having a place to live. Shelter is something we all need and there is no better way to invest in commercial real estate than by living in your investment while paying it off, therefore killing two birds with one stone.
Prior to buying an apartment building you should be well aware of the lease laws in the state in which the property is located. Lease laws vary from state to state but some federal laws regarding fair housing pertain to all states. You cannot discriminate against a renter on the basis of gender, race, religion, ethnicity, sexual preference or family situation. There are certain stipulations to renting to families with children in retirement communities, however. Make sure that you understand the lease laws before buying an apartment building.
Another way to get a real bargain when buying an apartment building is to find one that needs repairs. Because the residential real estate market is so slow, many contractors are looking for work and you can get some bargain rates on general contracting work. As long as the apartment building is located in a desirable location, it can be well worth it to make improvements and add to the value of the home.
Buying an apartment building can be a good way to get started in commercial real estate investing. Be sure to study the location of the building, get a good inspection of the property, examine the existing leases, consider maintenance and be well aware of lease laws prior to investing in rental real estate.
Resell or Hold?
When deciding whether to sell for a small property or hold on it it, it depends on what financial situation you are in. If you have a cash flow it is highly recommended holding onto the property, eventually the market will go back up. If you are losing vast amounts of money however, short sale and get out of the deal. Look at your financial situation and do what works best for you.
Make Money Renting
Investing in properties is a great long term investment. Instead of selling your house, you may want to have someone rent out your home, which is essence means they are paying your mortgage. Once the housing market goes up again you could have your home appraised and then sell at a higher price than you were once planning on.
Investing During A Recession
Buying Real Estate during a recession may seem like a scary thing to do but it is actually a great investment move. During a recession many homes are being foreclosed or selling at much less than the asking price. If you research why the house is selling, how long it has been on the market, and what the asking price is, you could end up with a great investment during a recession.
