Are you looking at dabbling in the world of renting? If so, here are five things you should consider before purchasing that potential rental property.
Tip 1: Location Location Location
If you haven’t settled on a property just yet, we highly suggest you think about the location of the property you’re considering. Sure, property is always valuable. However, not all properties were created equal.
Have a look at where you might think a rental property would work well in Malta. Cities such as St.Julians, Sliema, Gzira, Naxxar and Birkirkara tend to demand rental properties more than other places around the island. Foreign workers living in Malta tend to look at central areas to make it easier to navigate their daily routine. Apart from central Malta being extremely easy to live in, it’s also home to many companies. Making it perfect for people who would like to live close to where they work. Looking at these parts of Malta helps you have a higher success rate for your business.
Tip 2: Is the property you’re looking at worth the investment?
Buying for living and buying for renting tend to be slightly different. When looking at potential rental properties, it’s always advised to look at how much money other properties in that area are being rented for. Ideally, rental properties make you a profit. However, you should ensure that your monthly rental income covers your monthly loan. Having the property pay for itself lets you make sure bank payments are sorted for the month, and you don’t have to worry about the investment.
Tip 3: Furniture
As stated prior, buying property of your own and buying property for someone else to live in tend to be different in many ways. That also means the furniture you adorn the place with. When looking at furniture, you need to understand that not all tenants will treat your property the same. Although most tenants will take great care, others might not. That’s not to say you shouldn’t care what you place in the property. Remember, if you have good quality items in your property, you might be able to ask for more rental money. Just be sure your furniture and other items aren’t easily breakable, and remember, accidents happen to everyone.
Tip 4: Calculations
You’ve bought the property, furniture, and equipment a tenant might need. It’s now time to calculate how much you can charge for monthly rentals. Firstly, it’s greatly advised to stocktake all your items. Doing so will help you in the future when a tenant leaves and will help the tenant understand what is in the property they are renting.
When calculating a price, make sure that apart from the monthly payments covering any loans, it also covers any damages and or fixing that needs to happen from time to time. Sometimes, you need a plumber, and sometimes a shelf gets broken. It will happen more often than you think. Therefore, you need to think ahead when calculating your rental property price.
Has this helped you in any way? Let us know! At Real Estate Market, we’re here to help you get started on your rental property business!