Investing in Salt Lake City real estate offers a number of diverse opportunities. When you decide to buy real estate as an investment, you’ll find yourself asking a number of questions: Should you buy commercial space? A single-family home or a multi-family home? Do you want a property that’s in an HOA? Would a short-term vacation rental work better for you than a long-term rental? We have a lot of experience working with investors at every step of their real estate career. We think having a mix of different assets in your investment portfolio is the best way to optimize what you earn and minimize your risk. But, you have to start somewhere. Ultimately, the right Salt Lake City investment property for you depends on your goals.
Establish Your Investment Goals
Hopefully, you are clear on why you want to invest in Salt Lake City real estate. Perhaps you’re hoping to build a large portfolio that spans multiple markets and property classes. Maybe you want to establish some financial security or earn a passive income on your cash flow. Some investors want a second home or a vacation home that they can rent out part of the year when they’re not using it. Or, maybe you’re planning your retirement and you expect to move into the property that you rent out for the next 10 or 15 years. There are dozens of excellent reasons to invest in real estate. Your personal reasons will drive what you buy, when you buy, and where you buy. That’s why it’s so important to establish your investment goals and think about the moves you need to make in order to meet them.
Think About Your Tolerance for Risk
Once you know why you’re investing, think about risk and how you handle it. This will also impact which investment properties are right for you. If you see the uncertainty of financial assets as being a basic part of any investment strategy, you’re probably pretty risk-tolerant, and you have some good options with any Salt Lake City rental property. If the idea of a vacant property and no rental income makes you queasy, you’ll likely want to focus on a multi-family property where you have several income streams arriving every month with rental payments.
Take a Look at Available Inventory
In the Salt Lake City real estate market, you’ll find all kinds of homes in several different price ranges. Using your investment goals as a guide, evaluate each property in terms of what you’re likely to earn in rent, how much you can expect to spend on things like maintenance, taxes, HOA fees, and vacancy, and whether the numbers line up with what you’re hoping to accomplish. Check out the neighborhood as well. Is it going to be attractive to the tenants you want to attract? If your investment goals include renting out the property in short-term spurts and spending some time there yourself, you’ll want to focus on homes that are close to State and National parks and other major tourist attractions. If you want to focus on military service members and their families, this may sound obvious, but look for properties close to military bases and installations. Get to know the market when you’re trying to decide which properties are best for you. Staying aware of what’s out there and what the latest trends are in the area will help you make good choices.
Establish Relationships with Professionals Who Can Help
It’s hard to invest in real estate all on your own. Surround yourself with professionals and let them know what you’re looking for. Talk to real estate agents, brokers, and professional property managers. Sometimes, opportunities will pop up that aren’t widely advertised, and you’ll want to be on everyone’s call list when that happens. If you have a question about this topic or need assistance with anything else, contact a TierOne Real Estate Property Manager at 801-486-6200 or use the form on the side of the page. We are here to help you with your rental/investment property whether you are a current client or one in the making.