When looking to invest in a rental property, the most important factor to consider is what the future tenants will want. You will need to look at the property in the same way you would if you were to rent it from someone.
Step one is to figure out who is in your target renter market, and then you can start brainstorming.
Here are a few starting points to consider:
Is it a busy or a quiet street? If your target renter is a family, then you’ll want a quiet street. If it’s college students, then a busy street might not be so bad.
And if it is college students, how close is the university? And if it’s a family, you’ll need to research the local schools; where are they, and do they have a good reputation?
Also consider how far away grocery stores and local shopping is. If they have to drive far to get to the nearest Walmart or fast food restaurant, then they might not want to rent from you, even if you’re renting for a ridiculously low price.
Many families will not want a swimming pool, especially if they have young children. There is also a high cost for you and for your renters. The tenants may see a swimming pool as an expensive water bill, and if there is a hot tub then potentially an additional expensive gas bill.
Then think about the liability on you involved with a swimming pool. Pools also require upkeep. Will you pay for someone to clean the pool on a regular basis? And if you don’t, then you can’t be reassured the pool is being taken care of.
A pool sounds like a great investment, but in reality there are many hidden costs and potential problems and that could hinder your renting ability.
Keeping your target renter in mind, how many bedrooms will they want? It’s a good idea to omit all one bedrooms off your list right now. There is a very small market of single people who want them.
Most renters are not alone, whether they have a roommate or a family of four. It’s best to consider homes with at least two bedrooms, if not more.
Also look at bathrooms. Make sure the ratio of bedrooms to bathrooms is sufficient. Do you really want to rent a three bedroom home with only a master bath?
Lastly, look at the kitchen. When you see the kitchen, try to see it as if you are going to use it yourself. Look at cabinet and drawer space, is there enough? What about counter space? Is this what your renter would want?
Any potential renter is going to look at the upkeep of the home. How much are they going to have to do? Will they have to mow and water and weed a huge lawn?
Can you trust your future renters to keep the home looking good? So your two options are to deal with the home looking bad, or paying someone to do the yard work. Look at your target renters and decide if you can trust them to take care of your property.