If you can’t rent it or sell it when you are done being a landlord, then the property is not a good deal no matter the price.
It is pretty easy to get caught up as price being the prime factor in a property. It is important, but it is not the only important thing. You want to know the neighborhood. Understand who lives there. Is this an area where your target tenant wants to be?
If the house is in a sub-division, it may be under the control of a home owner’s association (HOA). Before considering placing an offer, you need to obtain a copy of their governing documents and read them thoroughly, as they will detail what is and is not allowed, including the ability to lease the home.
I recommend walking or driving through target neighborhoods at different times of the day and on both week days and weekends. It will help you get a better feel for what living there is like. Does traffic make it difficult to get out of the neighborhood? Do you see lots of children and families out and active? Or does everyone keep to themselves? If there is an HOA, contact a board member and see if they are willing to talk to you about the area. It will give you an idea of how friendly the board is toward investors. Some are not that excited about the prospect of having rental property in their neighborhood. It is not a deal breaker, but you should know what you are getting into.
Once you have a few target areas for homes, you can use a tool to set up searches and email you results. I have been using ziprealty.com because I like the interactive map feature. I will also look at trulia.com for info. If you are working with a realtor, they may be able to enter your search criteria into a tool that will email you results or give you access to houses listed on the multiple listing service. Try some out and see what you like. You are also going to want to find out if the local tax records are on-line as they can give you a lot of historical information on a house.
