Guide to Investing in Real Estate

Investing in real estate isn’t a decision you should come to lightly. Real estate is an investment that takes a lot of research and consideration. But, it’s worth it. Follow this guide to investing in real estate to ensure you make a sound investment:

Screen Shot 2017-09-21 at 9.59.58 AM

Pick a great location

Ever heard the saying, “location, location, location”? A great location is essential to the success of a rental property. To choose the ideal location, pick a property close to major roads, public transportation, local community amenities and great school districts.

Research rents

Once you have chosen an area, research how much properties in the area can charge for rent – both as-is and with repairs and improvements. Determine the actual value of the property – overestimating the value will just lead to vacancies or a lower rent than you originally thought.

Place yourself in the renter’s shoes

Get inside the mind of your target audience. For example, if you want to rent to families with children, you should choose a property located in a great school district – maybe even walking distance. Considering what your target audience is looking for will ensure your rental property is in high demand. A high demand property is less likely to have vacancies.

Start small

Begin your real estate investment career with a small and affordable investment. What are your options here? It turns out; there are several different ways to invest in real estate. From using a crowdfunding service to real estate investment trusts, here are five ways to diversify your investment portfolio.

Run the numbers and repeat

Treat your investment as its own business and run the numbers before committing to the project. To ensure a solid investment, be sure you accurately estimate rental income and ALL the costs associated with renting – as banking on the home’s appreciation alone is not the best idea. Contact a property management company or REALTOR® to determine a fair rental value for the property and ensure you take into account all monthly expenses associated with the property. In addition, always account for vacancies, turnover and eviction when running the numbers – as landlords should assume at least a month’s rent loss annually.

Don’t over-renovate

Don’t spend too much money renovating your investment property as you will likely have to pay for repairs on those items in-between tenants. To ensure your property is appealing to renters, complete basic renovations.

Carefully choose tenants

Use a rigorous screening process to choose potential tenants. Thoroughly screening applicants will ensure you have qualified tenants that pay rent on time.

Hire a property manager

Need advice or help with some of the above? A property manager is just the professional for you! They can handle everything from applicant screening to suggestions on where to buy a property and more!


Do you have any questions about investing in real estate? Give us a call. We have extensive experience helping other invest and manage their properties in the Austin area and would be honored to share our expertise with you!