Real estate is one of the most lucrative forms of income in Texas. Everyone wants a piece of the pie, a chance to get their feet wet and see if they can make a name for themselves in the market.
If you’re interested in purchasing property, there are plenty of opportunities to find the place that’s just right for you. However, before you start, you need to know the basics. Getting into the process can be a headache if you don’t know what to do, or where to begin.
In this blog, we will outline the three steps that you need to take to buy an investment property. So, whether you’re a first-time buyer or a seasoned pro, these tips will help get you started!
Step One: Choose Your Property
There are several different investment properties to choose from. Your selection depends on what kind of responsibility you’re wanting to take on. If you’re interested in residential real estate, you can purchase an apartment building, a condo, or a townhouse. If commercial property is more your style, you can purchase an office space or a building.
Each type of property comes with its challenges. If you invest in residential real estate, you’ll be dealing with individuals rather than corporations. Acquiring tenants and dealing with their day-to-day needs may become tedious. You also run the risk of them doing significant damage to the property. Residential tenants can occasionally be more of a nuisance than a business venture.
With commercial real estate, you avoid the aspect of communicating with individuals, but corporations come with their own risks. It’s impersonal, and this can lead to misconceptions and inconsistencies. You don’t have a direct contact if things ever run haywire. You’re dealing with multiple different people, sometimes all at once, and they all have separate opinions and processes. This can become confusing and difficult to deal with.
Choose what you’re most comfortable with and move forward from there. Everything has its challenges, it’s just a matter of choosing which ones you want to take on.
Step Two: Obtain Your Funding
Once you’ve chosen the property you want to invest in, it’s time to get the money you need to purchase it. There are several options when it comes to financing real estate in Texas. Choose the method that works best for your schedule and budget.
As long as you have the proper paperwork and income in place, Texas investment loans are not difficult to apply for. You provide your chosen company with the requested information and they perform a credit check to see if your borrowing history is sufficient enough to receive funding. If you qualify, they’ll send your application to a loan processor. At this stage, you’ll be appointed a liaison, someone that you can contact directly to receive updates on your application’s status. If you missed any information, or the loan company needs additional documentation, your representative will let you know.
If you meet all of the qualifications, your liaison will submit your completed application to an underwriting team. Once they’ve approved your funding, you will be scheduled for closing.
Step Three: Purchase, Renovate, List
Now that you’ve obtained your funding, you can purchase your investment property. Negotiate with brokers and buy the property that interests you the most. Making an offer can be scary, but taking that first step will put you on the path to something great.
Consider hiring an inspector before closing the deal. Property inspectors are trained to spot damages and inconsistencies that buyers tend to miss. Your inspector will let you know if the property is worth the asking price. If you check all the necessary boxes, you’ll have the keys in your hand before you know it!
Most places need quite a bit of work before they’re ready to be placed on the market. Consider hiring a contractor to make some updates or changes to your property before you list it.
Renovations are the most enjoyable part of buying and selling property. It gives you the chance to be creative and cultivate a new space. You can make vision boards and sample paint colors; pick out flooring and appliances. Witnessing the “Before and After” of a project that you put your heart into is extremely rewarding.
Interior designers can be helpful in the renovation process as well. If you’re unsure of how to utilize your space, they’re a great help in bringing your ideas to life.
When your property is ready for buyers or tenants, you can list it on websites, community boards, and social media platforms. Take good photographs and include all necessary information about your space. Be sure to list your contact information as well.
Buying investment properties is a great way to build wealth, but it’s important to go in with your eyes open. Do your research, and choose the methods that work best for you. You’re on your way to something great, and now you have the proper tools to get you there.