St. Louis is a dynamic rental market with some outstanding opportunities for real estate investors. When you’re smart about your investment decisions and you stick with a sound strategy, you can expect to earn some short-term cash flow and watch your investment appreciate in value.
Investing in the St. Louis rental market is a smart financial move.
Most first-time investors find there are numerous benefits to buying a rental property and plenty of challenges as well. And, there will always be some unexpected surprises.
If you’re investing in real estate for the first time, check out these tips from AMOSO Properties – a St. Louis property management company specializing in residential rental homes. We would love to help you avoid the expensive and time-consuming mistakes that many first-time investors tend to make.
Buy the Right St. Louis Investment Property
When you’re choosing an acquisition, you need to know what you’re looking for and how the property will fit your investment goals. It has to make sense mathematically, not emotionally. Think of this as a business, not a home. Consider your prospective residents. Look for a well-maintained home in a desirable neighborhood that will be easy to rent.
Many first-time investors make the mistake of buying a cheap property that needs a lot of work. This is a strategy that may have some merits, but it’s not a great way to start your investment career. The rehab that’s needed means there will be a delay in getting that property listed on the market.
While the prices are certain to be lower than other homes on the market, the amount you’ll have to spend to get that property into rent-ready condition may be more than you expect. Not only will you have to invest in repairs and renovations, but you’ll also wait longer to begin earning rental income.
Pricing Your St. Louis Rental Property
New investors are sometimes unsure about how to establish a reliable rental value for their property. The market is always changing, so it’s important to gather some reliable data before you even buy your property. This will tell you what to expect in terms of rental rates and resident pools. Find out what you can expect to earn and how long it will take you to find a well-qualified resident.
Your rental price is really market-driven. It doesn’t matter how much cash flow you’re after or what you’ll need to make your mortgage and tax payments. Evaluate the St. Louis market thoroughly and check the prices for competing properties that are similar to yours.
Prioritize Preventative Rental Property Maintenance
You know that rental property maintenance comes with the territory of being an investor, but you might not know just how much it’s going to cost. Try to get an idea of what it will cost you to provide emergency, routine, and preventative maintenance. Remember not to put off things that are needed right now. This will only devalue your property or allow its condition to deteriorate. Deferred maintenance will also lead to frustrated residents who are unlikely to renew their leases. When a resident makes a maintenance request, respond to it right away, or at least let the residents know when you’ll be able to take care of the problem.
Handling problems while they’re small will save you money and avoid headaches. In St. Louis we get to experience all the seasons, and that means heating and cooling systems need to be inspected and serviced on an annual basis.
Work with a St. Louis Property Manager
Unless you have the time, knowledge, and experience to manage an income-producing property on your own, hire a professional St. Louis property manager. You need someone who knows the local market and understands the property management industry. Find a company that can accurately price the home, market it, and screen for highly qualified residents.
Look for a management company that has great relationships with local vendors and has a reputation for helping owners earn more and spend less on their investment.
Consider our team when you’re looking for great management. We have a deep knowledge of the local market, and we can help you have a successful investment experience. Contact us at AMOSO Properties.