Investing in real estate can be a pretty exciting venture, and can provide potential for substantial financial rewards. As Kanat Sultanbekov says, while investing in a residential property and renting it out can be a good idea to enjoy consistent income, one must select the location of the property with a lot of care. Selecting the appropriate location for rental property investment is a very important decision, and can majorly impact one’s success as an investor. A smartly selected location increases the odds of securing qualified tenants and lowers vacancy rates.
Kanat Sultanbekovmarks a few factors to keep in mind when choosing the location for rental properties
Investing in a rental property can be a lucrative venture. However, the overall profitability of such an investment relies on one major aspect, which is its location. The location of a rental property can make or break its success in the market. It is not enough to buy a property that looks good, one must prioritize selecting a place that favours good financial returns and long-term growth.
Here are a few factors to keep in mind when choosing the location for rental properties:
- Neighbourhood and safety: The neighbourhood where a property is located would significantly impact its appeal to potential tenants. Strategically located, well-maintained and safe neighbourhoods attract more tenant interest and higher rents. Investors should properly research the quality of schools, nearby amenities and crime rates of a locality, and take a good look at the overall ambience of the neighbourhood to gauge whether it would attract quality tenants or not.
- Proximity to key amenities: While selecting a rental property, one must check its access to vital amenities like shopping centres, transportation facilities, hospitals, schools, and recreational centres. Properties that are located near such important amenities tend to be more attractive to potential tenants, which invariably leads to greater demand and rental value.
- Infrastructure development: It is prudent for investors to keep an eye on infrastructure development projects in the area where they plan to buy a rental property. Factors like the construction of new roads, commercial developments and public transportation lines can have a positive impact on property values. However, one must also be cautious about buying a property in areas where infrastructure projects may disrupt accessibility or the quality of life.
- Job market and development: Localities with better employment opportunities usually attract more tenants. Hence, investors must watch for announcements of large employers moving in and needing employees in a certain area. Most people would want to live near their workplace. Hence, the demand for residential rental properties is usually high in areas where employment opportunities are plentiful.
As Kanat Sultanbekov mentions, cash flow is considered to be the lifeblood of any rental property, and hence in addition to the factors discussed above, investors should also check the average rent of an area. In case the average rent of a locality does not cover the debt payments and operating expenses of the investors, it is not worth investing in a property there. Hence, investors should search for a locality
