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Factors to consider before buying investment residential rentals #1 Location Location Location I don't mean is it located next to the richest people you know. I mean is it located next to you so you can keep an eye on it. #2 if not, do you have a management team in mind to handle it? If not, find one and not necessarily your best friend. Have they managed property before and do they handle things the way you want them handled. YOU DO of course realize that you are responsible for the decisions they make.... Of course you knew that. #3 and you do have a back up management team, because what if something happens to that person that handles your property so well or as is common in this business the new ones may go out of business. #4 the cost of the backup and your first choice is something you can afford. #5 be sure you are not getting over financed. The reason the lender asks for reserves is because they know things can go wrong. Have a backup plan for the worst case scenarios and then enjoy the good that comes along. Life is much more simple if you are prepared. Think of it this way, you would not go into the desert with a car that leaks water without at least extra water in the trunk. Or leave for a long trip without a spare tire. #6 Ongoing List
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