Tips on Buying Your First Rental Property
Growing up, we’ve all been told to invest in property as it’s one of the sure-fire ways to get a passive income when you get older and reach your retirement years. It is true that real estate has made some people very wealthy and it is known to be one of the safest forms of investments.
In a study mentioned in The Sun Daily, almost 92% of Malaysians prefer renting a property compared to purchasing one. So, for those who are looking to purchase a property just for rental, there is a huge renters market out there.
However, there are a lot of things that you might need to consider before going into a huge investment such as this one. Here are some of Blueduck’s best tips those who are planning to be first-time rental property owners.
Tip 1: Are You Even Ready To Be A Landlord?
This is the first question you should definitely ask yourself as it’s a huge undertaking. Being a landlord means that you’re ready to work on improving the house, picking up the phone when your tenant has an issue, plumbing, maintenance and a whole lot more. You can very easily get someone else to do that but you will be spending the money that you will be getting as rental profit. So it will eat into your margins.
There’s a whole lot more to being a landlord than just collecting rent. So, please note that this is something that you definitely need to take into account when you’ve decided to become a property owner and a landlord.
Tip 2: Location, Location, Location
If you’ve decided that rental property ownership is right down your alley, you’ll need to find the right piece of property. In a place like Kuala Lumpur or even Selangor, there are just so many to choose from. From all the way in Ampang to Damansara and to the Golden Triangle of Malaysia there are thousands of properties you can choose from.
Did you know that KL and Selangor record almost 75 percent of all condo sales? This should give you an idea on just how many condos there are just in the Klang Valley alone.
So, when you look for the best place to buy your rental property, you should take into account:
- Accessibility of the location
- Availability of public transport
- Ease to get food and groceries
- Access to amenities
- A low crime rate
- A growing job market
All these little things will definitely add up when a tenant comes and looks at your place. In addition, it will definitely increase the value of your property in the long run which will give you more bang for your buck.
Tip 3: Always Calculate Your Margins
Investing in property is very much just like running a business. You have a capital, which is the money you put in to purchase the house. Then you have your revenue, which is the rent you get from your tenant each month. But, you need to be able to calculate your profit.
Owning a house and collecting rental isn’t a clear cut and simple transaction. You’d need to calculate how much maintenance fees you’re paying, any mortgage you will need to pay for monthly and things like management fees. All of that needs to be calculated before you can have your final profit numbers.
At the end of the day, the choice is yours, but we believe that there are better ways to go about property rental investments. Blueduck, Malaysia’s first flat-fee property management portal is here for you to ensure that you don’t have to worry about all the issues being a landlord.
Blueduck will screen through tenants for you, handle the house viewings and even serve as a concierge for whenever your tenants need you to fix something for them. Click here to learn more about Blueduck today!
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