If you’re in the market for a rental property, it’s probably best to purchase one near where you live. It’s hard enough to take care of your family home — let alone take care of a rental property in another city altogether. But if you get a deal you can’t refuse out of town, you might choose to throw caution to the wind and become the proud owner of an investment property hours away.
It’s not the end of the world if your rental property is in another city. In this post, as part of our offMetro blog section, we explore the key things to consider if you own an out-of-town Rental Property. You’ll have more work on your hands, but it can be done as long as you do the following four things.
1. Hire a Property Manager
If your rental property is a long-distance affair, you must hire a reliable property manager. It’s not mandatory, but it’s something you should do.
Unless you want to travel back and forth ad nauseam — spending hours traveling and attending to business — it’s in your best interest to retain the services of a dependable property manager.
Such a professional can help with tenant matters, emergencies that rear their ugly heads, maintenance and repairs, and more. You’ll have a reliable third party to step in when you can’t be there.
When looking for a good property manager, remember that location matters. Find a service provider situated close to where your investment property is. So, for instance, owning a rental property in San Marcos, Texas, for examppe, means you need a San Marcos property manager.
While working with a property manager is optional, it’s an expense you shouldn’t skip. Don’t be penny-wise and pounds cheap. Otherwise, your dream of owning an investment property could sour.
2. Understand the Local Rental Market
Don’t underestimate the importance of understanding the local rental market. While that might be easier if you buy a rental property near where you live, it’ll be more challenging if you buy one further from home. A rental market in another city will differ from the one you live in.
Understanding the ins and outs of local rental prices, vacancy rates, and tenant preferences will help you succeed.
A property manager can give you a crash course in the rental market, answer your questions, and help you make good decisions about setting a competitive rent. You want to make it competitive. It shouldn’t be a steal of a deal since your goal is to generate substantial rental income and watch the property grow in value.
But getting greedy and seeking too much money from tenants is also a bad idea. A property manager can help you make an informed decision.
3. Make Regular Visits
While you don’t want to be tethered to your investment property, that doesn’t mean you should be an absentee landlord. A reliable property manager will be a godsend since you can rely on them to handle many day-to-day things needed when operating a rental property.
But you should still stop by every now and then to inspect the property with your own eyes, meet the tenants and ensure they’re satisfied with the service they’re receiving from the property manager, and touch base with the property manager.
4. Familiarize Yourself with Local Landlord-Tenant Laws
When buying a rental property in another city, you must learn about the local landlord-tenant regulations. Knowing the ins and outs of leases, evictions, landlord rights, and tenant rights is vital. A good property manager can answer any questions you may have about any local landlord-tenant rules.
These are some things to remember if you buy an out-of-town investment property. Again, it’s best to find a rental property close to home. But if you find an opportunity too good to refuse, exercise caution by considering these recommendations.
