When you are purchasing an investment property in another city:
- Make sure you have a good realtor
- Make sure the contractors are qualified(licensed, insured, bonded)
- Know what you are looking for to meet your goals and strategy
- Invest in a property that is going to be easy to rent and later sell
- Find a property management company that will act as your partner
Do not assume anything. It is your money is on the line.
What is a Good Cap Rate for Rental Properties in Grapevine TX?
What to consider when shopping for a Grapevine, TX rental property:
Find a property in a stable or growing neighborhood
When you are looking to buy a rental property, look at the trends for the area to determine if the neighborhood is moving in a good direction. Historical data, taxes, pricing, and crime statistics can be used to determine any trends going on with the area.
Look for an investment property that is priced right. Don’t overpay.
The numbers must make sense. If you do not purchase at the right price point, you could find yourself in a negative cash flow situation every month.
Know the additional costs for the area
Things like insurance and taxes need to be factored into your costs when determining the profit, you can expect to get from a deal. Insurance rates can vary significantly from state to state, so don’t assume it is going to be the same as what you are paying in your state. Is the property in the city? What is the property tax rate for different areas you are looking at?
Don’t pick a property that is an anomaly
You do not want to invest in the one property that does not seem to fit in with the rest of the neighborhood.
Is there a reason the property seems like a great deal?
There are several things that can factor in a home seeming at first to be a fantastic deal but look cautiously at the WHY. Are you getting a good deal because the prior owner had a hard time selling it due to some features of the home? You could experience the same challenges when you try to rent it out or sell it later.
- Does the house have a bad floor plan?
- Is the property on a busy street?
- Is the property located in a neighborhood that is going downhill?
Be cautious and thorough when looking at properties that seem too good to be true.
Weigh the pros and cons of the age of the home
What is the age of the property? Are you allocating enough in reserve to take care of maintenance costs? Is the property going to need more expensive improvements like a new roof, new HVAC unit, etc. in the next few years?
Spending a little more for a newer property might be more profitable than an older home that is going to need a lot of maintenance work. Both old and new properties are viable options for rental homes, but you need to factor in any potential maintenance costs of each option before deciding to buy.
“I’ve remodeled older homes and rented them out, only to have a string of little things that tenants wanted fixed over the next few months. It’s not uncommon; take it into consideration. Does it mean the house will forever be a nuisance? Absolutely not. It’s simply that buying older homes may come with additional work, depending on how well they’ve been cared for in the past and how well you care for them going forward.” – Source: BiggerPockets: Pros and Cons of Old vs. New Rentals
How to Manage your Grapevine TX Rental Property Remotely
Purchasing a property in another city is just the first step.
Getting a return from that deal month after month is what you can expect from hiring an effective Grapevine property manager. Acting as a buffer between you and the resident along with all the laws that go along with it. It is important that you are getting a partner that is there to ensure you are successful.
Once you have purchased your out-of-town rental property, the next step is finding a Grapevine property management company that matches your goals and investment strategy.
Having a team that is familiar with local laws that are constantly changing is important, especially if you own property in a city you are not familiar with. Not knowing the local laws can leave you liable, so you are better off letting a local property management company manage your rental property. That are also in the position of being able to take good care of your tenants.
Finding the right Grapevine property management company
You will want to ask the right questions when you are interviewing Grapevine Property managers
- How to I communicate with you?
- How do you communicate with my tenant?
- How do I get paid? If the resident pays on the first of the month, when do I get my money? Some companies pay weekly and some pay monthly. It is important that their payment schedule aligns with your needs.
- What is your eviction rate?
- Do you have any guarantees such as a rent guarantee or an eviction guarantee?
- How long is your response time to maintenance requests?
- What is the average cost of a service ticket?
- What is your average turnover time to get a new tenant in the property once it is vacant?
- What is the average rent of the properties you manage?
What do they do to ensure you that they are part of your team?
If a property management company is not able to answer most or any of these questions, they probably aren’t the company you are looking for to care for your investment property.
- Is this company aligned with your strategy and goals?
- Do they manage the type of properties you have?
If you have a property that rents for $2000 a month and they manage properties around $300 a month, there may be a disconnect on how you want your tenants to be treated. It is important to have these conversations before you hire the company.
Hire a Grapevine Property Manager that knows the Laws and Regulations
Our team of local professionals at Mynd Property Management are different from other Grapevine property managers. We leverage real-time data to consistently better our services, providing owners with seamless management experience. Contact us today about Grapevine property management for your rental property.