If you’re looking to buy an investment property, you want brokerage websites that update almost as quickly as the MLS database like https://www.redfin.com/ or https://www.realtor.com/.
If you’re specifically in the market for foreclosed homes, then your best bet would be the Department of Housing and Urban Development’s Hud Home Store.
You can also search for a local realtor using this map from the National Association of Realtors: https://www.nar.realtor/mls-map-of-the-national-association-of-realtors
đź’ˇ Note: If the map is taking too long to load, you can copy and paste the website URL of your chosen local realtor into a new tab on your browser.
Learning About Property Investing
If you’re new to property investing, then you want to learn the ropes before investing your hard-earned nest egg. But before jumping in, you’re going to have to decide whether you want to invest in Residential Real Estate, Commercial Properties, or both.
- To learn about Property Management in general, the Institute of Real Estate Management (IREM) offers a wide range of certifications and accreditations: https://www.irem.org/
- For Commercial Property Investment, head on over to the Building Owners and Managers Association (BOMA): https://www.boma.org/
- For Residential Property Investment, the National Apartment Association (NAA) has a bunch of online courses and in-person events: https://www.naahq.org/
đź’ˇ Pro Tip: If you want to invest in your education, then you can go through the traditional university route. Harvard has a Real Estate Investment Online Course for example.
What is the 1% or 2% Rule in Property Investment?
The 1% rule in property investment simply states that your property’s rent should be at least 1% of its purchase price.
This used to be called the 2% rule but a lot of property investors have dropped their standards to 1% due to the difficulty of finding properties that adhere to the 2% rule.
At the end of the day, this is more of a general guideline that can help you make quick assessments when necessary. The best way to invest in property is to do your due diligence and make an informed assessment before locking in your investment.
How to Find Reliable Contractors
Even if you find the perfect property to purchase and you have no problems in terms of capital, you’re still going to need reliable contractors to get the job done.
- Networking is the most reliable way to find good contractors. You may not know a lot of people who work in construction, but you’ve probably been to your local lumberyard or acquired the service of a top-notch HVAC contractor. Start with the people you know and ask them for a referral.
- If a bid is too good to be true, it probably is. Ignore contractors that bid too low. It might seem like a good deal now but once the problems start to pop up, then you might end up spending more than you bargained for.
- Always verify their license and insurance. Reliable contractors will have their paperwork in order. So this is an easy way to separate the wheat from the chaff.
Should You Finance an Investment Property?
Before you apply for a mortgage loan or a Home Equity Line of Credit (HELOC), there are two factors you should consider before financing your investment property.
- You’ll want a FICO score of at least 670 (Good) to get a loan with decent rates. If you’re a bit off from a Good credit score, then you can build your credit with your recurring payments by paying them with Cushion’s Virtual Debit Card.
-  You’ll need a down payment of at least 20% to avoid paying for Private Mortgage Insurance. It’s also possible to get better rates if you increase your downpayment to 25%.
💡 Pro Tip: If you’re low on capital, then Seller Financing can be a good alternative to traditional mortgage loans.
