To be successful as an investor is to make the numbers add up to the highest return on your investment dollar in passive income. Done right, investing can be very profitable and provide security for your retirement. In addition, diversification offers you a well-balanced portfolio, building in a hedge against inflation. You should have investments from every market sector, which brings us to single-family homes. Read on as we explore five of the red flags to look for when buying a single-family home for investment in RI.
If you don’t get a good feeling about the property’s surroundings, this is one of the red flags to look for when buying a single-family home for investment in RI. Even the best single-family home can’t outweigh a bad neighborhood and affects property values, rental rates, and issues with occupancy, damages, and crime. Unfortunately, new investors often find the least expensive property available without considering how the location can affect your cash flow, and the future outlook can substantially influence the numbers. However, suppose you are aware of city planning involving added improvements, and you notice other recently rehabilitated properties. In that case, it may be worth taking a deeper look at jumping into an investment in a location in the early stages of revitalization.
Homeowners often take shortcuts to save money, and avoiding permits for home improvements is one of the ways some choose to do so. Unfortunately, this type of unpermitted work is a huge red flag to look for when buying a single-family home for investment in RI. While you could work with officials to approve the existing work after the fact, often, it is required that you completely demolish the work and rebuild under the proper permitting and building procedures.
Mold. Just the word is alarming, and where there is water damage, mold can be present. So when water signs are apparent, take heed of this major red flag when buying a single-family home for investment in RI. On the other hand, if recent work by a professional remediated the mold issue, and there is documentation of this work, even though the owners didn’t repair the damage, this puts a new light on the subject, and the investment may be sound.
Regrettably, homes that go through foreclosure often feel the wrath of the owners who have lost their homes in that they do severe damage before leaving the remains to the bank. If the history shows foreclosures, this is another one of the red flags to look for when buying a single-family home for investment in RI. Another issue with properties that have undergone foreclosure is that they are often abandoned and unkempt for a lengthy period. What may have started as a minor issue with the roof, for example, is now a significant repair.
Signs of pests are red flags to look for when buying a single-family home for investment in RI. Because they hide in dark, difficult-to-reach places, you will need to know the signs of animal or insect waste and other small telltale signals, like entry spots, with which more experienced investors are familiar.
Wouldn’t it be great to have someone working with you to help you watch out for these and all of the other red flags that investors like you should look for when buying a single-family home for investment in RI?
Why not call on the full-service team at Ocean State Homebuyers to help you? And don’t forget to ask about our current inventory of the best single-family homes available in RI right now! Contact Ocean State Homebuyers today at (401) 290 8784.