When you are considering purchasing a property for real estate investing, you'll want to remember that there are generally two ways to make money on the property you purchased. One is from capital appreciation, where the value of the property increases, and the other is from renting your property out. However, how do you know whether a property is a good investment? Deciding before you purchase an investment property whether to Flip it or Rent it will make you the most money at the end of the day.
Obviously, one of the most important factors in determining whether a property is a good investment or not, is to consider the purchase price of the property. If after you've made the initial down payment and your mortgage payment is over and above what you can rent the property out for, you'll find that to be a poor investment. Determining whether or not the property will bring in a positive monthly cash flow for you is one of the most important factors.
The location of the investment property is also an important factor. Regardless of whether or not you purchase a rental property well below its market value, if you can not find tenants for the property, it won't matter. Make sure you choose a property in a location where there is a demand for housing. Researching the market can save you the hassle of a poor choice in real estate investing. You'll also want to make sure the property you choose will appeal to the masses. Just because you like the uniqueness of a house, doesn't mean someone else will and you may have trouble renting or selling when the time comes.
If the investment property you are considering is a fixer-upper, you may want to bring a contractor with you to determine the cost for repairs and renovations. You'll want to figure this into the cost of the property and if it will not yield you a return on your money, whether you plan to sell or rent, you are taking the risk that it may be a very poor investment.
Real estate, whether you plan to flip houses or rent them out, can be a very profitable business for yourself. While determining whether or not a property will make a good investment or not can be difficult, the important thing to remember is to always do your research. Find out the rental history on the property, the demand for housing in that particular area, and any other pertinent information you can find on the investment. Any research you do will help you to choose properties that will be beneficial to your real estate investing.
Related Articles
Rental Agreement - Discover Your Greatest Asset as a Landlord
By: Kevin Kiene | 26/05/2008 | Real Estate
The convenience of using the internet to create an online lease is highly advantageous to the real estate industry. Landlords now have the ability to locate leasing documents within minutes. This article highlights online lease preparation and the creation of rental agreements.
The Lease Agreement: Pay Now or Pay Later
By: Kevin Kiene | 04/01/2007 | Non-Fiction
This critical document, gives the tenant the right to occupy a property or unit. Basically, you are granting a tenant(s) the right to live in your property for a specified amount of time, and your primary protection comes from this one document.
Picking Up The Pieces Of A Broken Lease: Consider Your Options....And Choose The Right Lease
By: Kevin Kiene | 23/01/2008 | Real Estate
Has your tenant tried to break the lease? Has your property been damaged by a tenant? These are some of the difficult situations that may arise in the course of managing your rental properties. Learn how to select a course of action and still be within your legal rights as a landlord.
Tips For Locating Real Estate At Wholesale Prices
By: Kevin Kiene | 25/12/2006 | Real Estate
Wholesaling most often refers to the process of buying real estate for below it's market value, and then selling that property to another investor, without fixing it up - this process is also sometimes known as "flipping properties"
Buying and selling or "flipping" properties that were purchased at wholesale prices can...
No More Ugly Houses; How to Buy Real Estate Now
By: Lance T. Walker | 06/08/2008 | Real Estate
There are people in your area right now who will
sell you a pretty home, in move-in condition, in
a nice neighborhood, for much less than it's
actually worth. You DON'T have to deal with tenants.
You DON'T have to buy and fix up some broken-down
shack in a bad part of town.
As a Landlord is This Type of Lease Best for You?
By: Michael C. Podlesny | 11/01/2008 | Business
If you are a novice landlord or even have some seasoning under your belt, I am sure at some point you either have or will ponder the question as to whether or not to use a month to month lease.
Why a Good Rental Agreement is Your Best Defense Against a Bad Tenant
By: Kevin Kiene | 23/01/2008 | Real Estate
If you've been in the property management business for more than a few years, you've probably been hit with every landlord's worst nightmare: the bad tenant. No matter how rigorously you screen applicants and check references, one is bound to squeak through sooner or later.
Property Investors Run Now for Prague in the Czech Republic
By: Nicholas Marr | 10/02/2008 | Finance
Czech Republic is showing great signs of growth and at time of writing offering overseas investors superb high loan to value mortgages. The time for investment is now and in particular the area of Prague
Latest Investing Articles
Unsecured Bad Credit Loans: Bad Credit Unsecured Loans Requiring No Collateral
By: Mack Dowse | 21/08/2008
The unsecured bad credit loans are very important to people who have a history of bad credit. Since these loans require no collateral, they are best suited to people with bad credit history. These loans are also very helpful to those people who are reluctant to pledge any of their property. Tenants are also able to take advantage of these loans moreover if borrowers repay these on time it gives people a chance to improve their credit ratings.
How To Make a Killing in Forex Trading
By: Hector Milla | 21/08/2008
It could be stated that, a great percentage of people think that in order to be successful in the forex market you need years of experience, and much important than that a lot of money in your bank account, while this can be truly helpful in some way, it is not a recipe for success. This article is intended to list some basic but useful forex trading advise.
The Road to Become a Super Affiliate in 2008
By: Jasbir Kaur | 21/08/2008
Every affiliate marketer would like to be a super affiliate one day. In fact, you cannot just join an affiliate program and hope that you can make a lot of money. You have to work in order to make your living.
Is Online Futures Trading For You?
By: Sai Vallejos | 21/08/2008
This article is an introduction to online futures trading
How to Succeed in Online Futures Trading
By: Sai Vallejos | 21/08/2008
This article is a guide on how to earn big in online futures trading.
What Are All the Types of Mutual Funds Available?
By: Amy Nutt | 20/08/2008
When it comes down to it, there are thousands of choices when it comes to investing in mutual funds. The only way you're going to know which fund is the best for you is by assessing the investment strategy of that fund and looking at the risks that are associated with it.
Has the Rally Ended?
By: Sy Harding | 20/08/2008
The S&P 500 is still down 14% for the year, still 19% below its peak of last October, and this second bear market is already looking 'Toppy'!
Buying Off Plan Property in Kefalonia, Greece
By: Michelle Jackson | 20/08/2008
Why Buy Off Plan and What Does It Involve?
There are many reasons why off-plan property in general and in particular in Kefalonia is interesting to investors.
Off-plan properties offer an excellent opportunity for investors looking to buy properties at a price that is generally below the market value. In addition, most development companies are prepared to offer a lower price when the project is in an early stage of its development and then the prices increase as the project develops.
More from Kevin Kiene
What Every First Time Investor Should Know about Creating a Lease Agreement
By: Kevin Kiene | 18/07/2008 | Real Estate
It is necessary for real estate investors to have an accurate and legally sound lease agreement that is specific to their state and rental property location. This article explains how you can use the web to create such a lease agreement, and further, will help you find the best website from the multitude of available.
A Guide For Preparing Yourself For Eviction
By: Kevin Kiene | 07/07/2008 | Self Help
During this time of recession, "bank owned" signs and eviction notices seem to be everywhere you look. If you are a property manager or landlord, it is especially important to take extra provisions to protect your rental properties so that you don't lose money in the long run. One preventative...
Creating a State Specific Rental Contract Online
By: Kevin Kiene | 25/06/2008 | Real Estate
Finding a detailed, complete and state specific rental contract online is so important to a landlords success. This article will show you how to locate and what to look for when choosing your rental contract. There are many resources online to choose from so we will help you pick the best site over all.
Rental Agreement - Discover Your Greatest Asset as a Landlord
By: Kevin Kiene | 26/05/2008 | Real Estate
The convenience of using the internet to create an online lease is highly advantageous to the real estate industry. Landlords now have the ability to locate leasing documents within minutes. This article highlights online lease preparation and the creation of rental agreements.
Picking Up The Pieces Of A Broken Lease: Consider Your Options....And Choose The Right Lease
By: Kevin Kiene | 23/01/2008 | Real Estate
Has your tenant tried to break the lease? Has your property been damaged by a tenant? These are some of the difficult situations that may arise in the course of managing your rental properties. Learn how to select a course of action and still be within your legal rights as a landlord.
Why a Good Rental Agreement is Your Best Defense Against a Bad Tenant
By: Kevin Kiene | 23/01/2008 | Real Estate
If you've been in the property management business for more than a few years, you've probably been hit with every landlord's worst nightmare: the bad tenant. No matter how rigorously you screen applicants and check references, one is bound to squeak through sooner or later.
Eviction: Helping The Landlord Make The Right Move At The Right Time
By: Kevin Kiene | 29/10/2007 | Real Estate
Eviction is one of the biggest nightmares of being a Landlord. The court proceedings can be time consuming, and expensive, and are best evaded if there is any reasonable solution. If a tenant has violated their lease agreement, it's imperative for the landlord to take all measures available in order...
Nice Landlord Or Mean Landlord?
By: Kevin Kiene | 24/10/2007 | Real Estate
The impulse to be overly nice to tenants is one of the most common mistakes made by those who are relatively new to the property management business. It's a completely understandable impulse; nobody wants to be seen as the bad guy, and as the old adage says, you catch more...
Finance 
