Almost everyone is in the constant search of new incomes. If you have some savings you might consider spending them on a down payment for a housing building. Housing buildings are a good way to have new incomes with the rent your future tenants will give you. It is good, but it is not easy. Here are some possible problems of such a purchase.
The building itself
You might be tempted by a cheap building to increase the profit by lowering your payment. Cheap building are often cheap for a reason. Usually, they’re old so you increase your chances of having bad surprises. You might face some problems with plumbing, isolation, electricity, etc. It’s important to contact an hidden defect lawyer if you have this kind of problems so he can help you solve them without too much expenses. You also have to purchase one that’s appealing or that only need esthetic renovations. You also have to consider the location. A cheap building will often be far from the facilities and in an unpopular neighborhood. These aspects are crucial if you want to be able to find new tenants and possibly increase the price of the rent.
If you purchase an existing building, you’ll have to deal with the actual tenants. If some have been there for many years, you have to make sure they’re reliable and respectful. You also have to be really prudent with future tenants. You have to make a credit investigation, have a complete and clear lease and make them sign a contract with the building rules. With those, you protect yourself from any possible misconduct because you will be able to easily oust disturbing tenants.
If your budget is narrow, you probably consider doing the maintenance yourself, hire someone you know or give a discount to a tenant to do it. The maintenance of your building should be on top of the list when it comes to expenses for your building. You have to make sure that the tenants are satisfied with the building and that the essential renovations are done quickly so it doesn’t get worst. Your building might be in good shape when you purchase it, but it’s important to keep a regular maintenance to keep it that way. You also have to inspect every apartment when the tenants leave to make place for new ones, so you’re sure that they didn’t break something without telling you. So hiring a professional is probably the best thing you can do to avoid unpleasant and expensive surprises.