Do you own real estate in Nevada County and are considering renting it out? Maybe it was your first home and you’ve just bought a second property to call home. Or, maybe you inherited a property from a family member and are considering renting rather than selling. Whatever the circumstance regarding your real estate and investment, there are a few critical steps you can take to become a successful owner of an investment property.
First, determine the current market rental rate. This can be done by reviewing Grass Valley, Nevada City and surround area comparable properties for rent with the same features, amenities, and location as your rental.
Second, calculate income and expenses to get an idea of the cash flow. Use the determined market rental rate and subtract expenses including mortgage, property taxes, insurance, HOA dues (if applicable), maintenance, and other expenses such as lawn care or pest control. This fundamental step determines if your investment and real estate property will “cash flow”.
Third, assess your property to determine if it is ready for a tenant. I use a mechanical and cleaning checklist to ensure I am covering all the details. Some simple and inexpensive quick fixes to add that special charm factor to your rental can include: a fresh coat of paint inside, a good interior cleaning including the carpets, pressure washing the outside including walkways, decks, and the home’s exterior. Local Grass Valley businesses like B&C True Value, Hills Flat, and Hansen Brothers can help you get started with completing these important tasks. It is also critical to make certain that everything is in working order and in compliance with applicable laws.
So, after reading this far are you eager to roll up your selves and get started? Or, is your head spinning with questions and “what ifs”? The last step, and probably the most critical in becoming a successful owner of an investment and real estate property, is determining if you’re suited to being a landlord. Ask yourself if you really have the time, experience, and resources to get the job done. If so, that’s great. If not, hire a property manager. They have the tools and resources to determine the current market rental rate, calculate if your property will “cash flow”, and ensure that the property is in compliance and ready for a tenant.
The above article was slightly modified from the original article that was featured in the 2/28/13 Edition of the Showcase, a real estate insert to Nevada County’s Newspaper: The Union.