- August 21, 2020
- Posted by: Editor
- Category: Advice
Here is a beginner’s guide for anyone considering buying a property for rental purpose. Investing in real estate is a good strategy to gain passive income.
The choice of location should be of top-most priority when considering renting out your house in Lagos. While considering whether short term or long-term rentals, your location will determine if you would be making a lot of profit or loss. It determines the class of tenants moving into your apartment and the rate you should charge. For instance, the class and income rate of tenants in Victoria island would differ from Iyana-ipaja.
Here are some of the questions you should have answers to before investing:
- Consider the proximity of your apartment to the market.
- Are there any ongoing investment projects in that location that would appreciate your property in few years?
- What are the prominent companies in and around the location?
Calculating the average rent home owners charge their tenants will give you an idea of what to receive. Do a research to find out if the average rent per annum covers all your expenses, taxes and mortgage payment. Also check if there are major investment plans and developments in that location.
You want to make sure the rent is fairly affordable and enough to cover your mortgage payments and other maintenance fees.
The first thing to consider when investing or purchasing any property is security. So in an environment (state or country) that’s hostile or with an high crime rate and vices such as vandalism, burgling ,robbery, drugs and other illegally activities would be a wrong place to consider investing or buying real estate there.
To prevent this, it’s strongly advisable to visit the police station closest for a crime report and statistics for a careful observation of that environment.
Another thing to consider when moving into a new environment are basic environmental factors like a good road network, transportation, water supply, population density, and also side attractions like museums, parks, malls, gyms, hotels, bars, nightclubs, golf clubs etc.
All this will give you an insight on the best environment to get a new property.
If you are here, that means you are ready after reading our guide to buying your first investment property. You can visit www.bricksandtierra.com to get started.