Even experienced investors can feel the stress and anxiety that comes with acquiring a new property. There are dozens of details, and any of them can go wrong at any part of the process. There’s also a lot of risk involved in real estate investments, and that’s in the back of every buyer’s mind as they’re making an offer and closing the deal.
When you’re buying your first Portland investment property, that stress is often amplified. It’s easy to become overwhelmed.
The trick is to prepare yourself as much as possible and to know exactly why you’re investing.
Establish Your Investment Goals
It’s tempting to jump right in and buy the first property that presents itself.
Take it slow – even in a competitive market like this one.
Before you even begin looking for that perfect investment property, you need to have an established set of consistent goals and expectations. Without investment goals, you may find yourself losing money and making a lot of mistakes. Profit and success will arrive when you’re able to make strategic decisions that fit the profile of your ideal investment property.
Create a one-minute elevator speech that defines why you’re investing. Are you interested in short-term cash flow or long-term appreciation? That answer will help you decide which neighborhoods will work best for you and what type of property you want to focus on acquiring.
Investment goals should be clear, concise, and attainable. Write them out and review them frequently to make sure you’re on the right track.
Follow the Portland Real Estate and Rental Markets
The Portland real estate and rental market is just like any other market in the U.S. It moves through normal, predictable trends and cycles. However, it’s also unique. There are tenant protections in place here that need to be considered when you’re buying, pricing, and renovating a home.
Educate yourself on the real estate market so you’ll understand the inventory and what you’ll have to spend. Educate yourself on the rental market too, so you’ll know what kind of rental value to expect and how much you’ll likely spend on things like maintenance, vacancy, and tenant placement. Study neighborhoods and shifting demographics. Figure out what you’ll need to spend to get the property that fits your investment goals. Knowing how the market works will help you decide what to buy and when.
Budget More than is Necessary
You’ll have less stress buying your first investment if you over-budget.
Most investors plan for vacancy costs, unexpected repair costs, and expenses associated with marketing your home, preparing it for the rental market, and finding good tenants.
Set up a maintenance reserve for any emergency repairs, and make sure you have enough money to cover the lack of rent that comes with vacancy. Always purchase a property that’s nearly rent-ready. This will ensure you’re not spending a lot of money on renovations or delaying the rental income you can earn.
Work with Portland Property Management Professionals
The best way to reduce and even avoid stress during the process of investing is to work with Portland property managers. A good property management company will understand the rental market and its demands. You’ll have some idea of what kind of repairs and upgrades might be necessary to get the home rented. You’ll know what vacancy rates tend to average and whether you can expect high tenant turnover.
Don’t buy an investment property without talking to a property manager. If you’re not sure where to turn as a new investor, contact us at Performance Properties. We’ll help you navigate the process.
