With market fluctuations and an evolving economy, investing in real estate can prove to be a profitable insurance policy for your financial future. If you’re thinking about making your first investment, here are a few things to consider.

Property investors rode a wild wave during the pandemic, with the short-term rental market stopping, then restarting, and property prices in many second-home markets soaring. What does the future hold for new second-homeowners and for managers of more robust property portfolios? We’ll explore that and more, all May long, at Inman.

Are you receiving our weekly Teams Beat newsletter? For the latest news, insight and trends on teams, subscribe here.

An investment property is a great way to generate passive income and diversify your financial portfolio. Real estate investment can prove to be a lucrative venture for those seeking to make a name for themselves in the industry and ensure a healthy financial future.

When choosing your first investment property, it’s important to keep several factors and qualifiers in mind. Here are a few tips for investing wisely. Also, make sure to consult your financial professional for expert and personalized financial advice.

1. Make sure you can afford it

The most important part of investing in real estate is making sure you can afford it. You want long-term debt locked in for as long as possible so you’re not forced to sell due to market fluctuations.

Ensuring your financial status is healthy enough to branch out into investments is the first step you should take when seeking an investment property.

2. Take advantage of low loan rates

There are currently very low borrowing rates that are available. You can take advantage of this, borrow at a low rate and then purchase a property that’s in high rental demand.

3. Start small

Beginning your investment portfolio with a small, single-family home or duplex is a smart start. Seeking smaller properties in areas where prices are more affordable can be a great way to set a solid foundation for your investment future.

4. Location, location, location

We cannot stress enough how important a property’s location is, especially when it comes to investing. A long-term investment means you want to purchase a property that is well-located and in an up-and-coming area.

Walkability and area amenities are crucial, but also ensure that the home is not located directly next to a noisy street or freeway.

5. Keep it low maintenance

Find a property that requires minimal work and is easy to maintain. Making sure the structure of the home is sound and the interiors are up to date ensures you don’t have to worry about spending a lot of money on renovations at the onset of your investment.

All in all, choosing the right investment property is an important decision, and many factors play into guaranteeing a successful investment. Taking advantage of low borrowing rates, choosing the right location, starting small and making sure you can afford your investment is incredibly important.

With market fluctuations and an evolving economy, investing in real estate can prove to be a profitable insurance policy for your financial future.

David Parnes is a director at The Agency in Los Angeles. Connect with him on InstagramJames Harris is a director at The Agency in Los Angeles. Connect with him on Instagram.

Show Comments Hide Comments

Comments

Sign up for Inman’s Morning Headlines
What you need to know to start your day with all the latest industry developments
By submitting your email address, you agree to receive marketing emails from Inman.
Success!
Thank you for subscribing to Morning Headlines.
Back to top
×
Log in
If you created your account with Google or Facebook
Don't have an account?
Forgot your password?
No Problem

Simply enter the email address you used to create your account and click "Reset Password". You will receive additional instructions via email.

Forgot your username? If so please contact customer support at (510) 658-9252

Password Reset Confirmation

Password Reset Instructions have been sent to

Subscribe to The Weekender
Get the week's leading headlines delivered straight to your inbox.
Top headlines from around the real estate industry. Breaking news as it happens.
15 stories covering tech, special reports, video and opinion.
Unique features from hacker profiles to portal watch and video interviews.
Unique features from hacker profiles to portal watch and video interviews.
It looks like you’re already a Select Member!
To subscribe to exclusive newsletters, visit your email preferences in the account settings.
Up-to-the-minute news and interviews in your inbox, ticket discounts for Inman events and more
1-Step CheckoutPay with a credit card
By continuing, you agree to Inman’s Terms of Use and Privacy Policy.

You will be charged . Your subscription will automatically renew for on . For more details on our payment terms and how to cancel, click here.

Interested in a group subscription?
Finish setting up your subscription