Well, the price is right that’s for sure.  For buyers with solid credit and money down, investing in rental properties is definitely a great option right now.  Buying prices are low, interest rates are low and opportunities abound as there are literally millions of properties on the market right now, but there are a few points every buyer of rentals should consider that will leave enough financial elbow room for the investment to be lucrative in the long run.

One of the best pieces of advice when getting into the landlord business is to think about the desirability and livability of the property.  Things like location and size are just as important when purchasing future rental properties as they are when purchasing a home for oneself.  If you are looking at a large home that you would like to rent with multiple bedrooms, it is obviously going to be a good fit for a family (unless you like the idea of renting to multiple “young adults” and then you really want to consider the condition of the house), so you need to look at the community and schools.  Is the property in a good neighborhood? Is there yard space? Is it close to a quality school district? These are still things to consider if you want to attract the right kind of renter who will cherish your rental as their own home.

Take the time to consider who your renter will be when selecting properties.  Don’t just purchase a huge house on a busy street because you can get it for $50000.  You may have a tough time finding the right family who wants to raise a family on that busy street.  If you have trouble renting the property and decide to make the house a duplex or multiple apartments, you are talking about renovation expenses that you may not have considered when you started your journey into real estate investment. 

That is the other high dollar ticket item that can really make or break your rental investment property, repairs and renovations.  Ideally you should try and find a property that really only needs a fresh coat of paint, a deep cleaning, and some minor repairs, but since the best deals are usually in the pre-foreclosure, foreclosure and REO properties, finding a property in need of minimal repairs could be difficult.  Don’t lose faith; there are plenty of great properties out there.  Just be sure to calculate the cost of repairs and maintenance into your overall financial plan for the property.  These costs need to be included in your calculations, as well as extra cash for unforeseen problems and repairs and for months when the property may be empty.