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Tuesday, 29 September 2015 05:00

How to Identify Properties for Long-Term Buy & Hold

buy hold sell propertiesA rental property investor worth his salt knows which one is a flip property and which is long term investment. Ideally, such a house must maintain its long term wealth and also improve upon it to deliver handsome returns.

Of course, all this should come in addition to the rental value increments. Not to forget, the maintenance and repairs should also be minimum. When you are taking business loans for rental property, you expect to close the perfect deal.

Sounds little too much to expect? Well, you can't always have everything when buying an investment property. In a decades time (which is normal time-frame for long-term properties), you tend to think about certain important considerations compared to the house flipping investments. Here's how to narrow down on properties with a long term perspective.

5 Qualities to Check in Long-Term Rental Investments

1. Expandable Plumbing

When you are inspecting the home, look for signs of unfinished plumbing or expandable plumbing and electrical fixtures. For example, the attic may have unused electrical fittings or plumbings. Such a space can be expanded into a spare room. Same goes for unfinished basements. These are signs that property has potential to expand and can deliver much higher returns in the future.

2. Adequate Parking

Most suburb neighborhoods have parking lots. This means the potential tenants are going to ask for one the moment they inspect the property. Do observe if the property has the potential to create a parking lot. If you are buying an investment property, the more the parking the better. However, prefer properties where the parking lot can be expanded and is not currently there. This is because the business loans for rental property can increase considering more features offered by the property.

3. Ample Vacant Land

If a home has vacant land, this promises expansion plans. Even though you may not choose to expand, it still serves as open space. This means that large families are more likely to rent such a home. Make sure such space must be within the zoning requirements as mandated by the town/county. An exception to this rule can be urban areas or city centers. In this case, not only will you incur higher business loans for rental property but also face severe rules for expansion. Don't let vacant land be a non-performing asset.

4. Perfectly Leveled Lot

This is not applicable for suburbs where large communities are carved on leveled lots. But in cities, it is often noticed that old lots do not adhere to this criteria. Pay particular attention to the level of the ground and if it poses any issues. This can be unfavorable to the tenants in the long run. Also, it can cause flooding during heavy rains and damage basements. Even if not, it can certainly cause water and mold problems.

5. Easily Accessible Crawlspace or Basement

If the owning period of home is in decades, it is advisable to look for basement or crawlspace access. You may have to reinforce the foundation or shift the spaces, but it will be worth the prices. A crawlspace that is very hard to crawl isn't to any owner's taste. Easy access to home's various spaces reflects transparency in construction as well as a good quality build.

A good opportunity may come in disguise. You have to identify the potential of a house in the coming decades well in advance. This means that you will have to consider the above mentioned as well as many other factors to finally make a decision. And if you are taking substantial business loans for rental property, holding property for long term can deliver huge returns.

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