Choosing your next (or first) Frisco rental property can be challenging without considering critical factors that could affect the returns for the rental. A house might look great from the outside, but unless you also analyze the location and neighborhood, you could find yourself without tenants (and income)!
Finding the right location is a critical key to your success as a real estate investor. What neighborhood factors can influence the profitability of a rental property (even if it offers excellent amenities that renters want? Our Frisco property management experts weigh in below!
How to Choose the Ideal Neighborhood for Investment Property
A property manager knows that different neighborhoods appeal to different types of renters. Depending on the area for your rental properties, you could also deal with factors you didn't plan for as a rental property owner, like high crime rates or student tenants. How much you charge for rent will also vary from one place to another and can significantly impact the quality of renters you're able to attract and the return on your investment.
When considering a new real estate investment property, make sure the location is the right fit for your rental property portfolio and goals! These property management insights should guide you through a few critical steps to take to find your ideal rentals.
Review Your Investment Goals
A property management expert can tell you that not every neighborhood is the right fit for every real estate investor. However, that doesn't mean some areas are "bad" versus "good" or won't work well for other investors. Your ideal location depends on your investment strategy and the goals you want to achieve from the property.
For instance, some real estate investors may be satisfied with the rental returns and DIY property management for properties in specific neighborhoods. Other investors, however, prefer purchasing properties in high-end neighborhoods that appeal to renters looking for luxury and status without the hassle of homeownership. Hiring a property manager to take care of these rentals and residents is part of their plan to operate luxury rentals with a hands-off approach.
Make sure the neighborhood for your next rental property falls in line with your goals, management style, and target renters. Forcing a property that might be good for someone else into your portfolio could lead to poor returns and frustrations when it takes more effort to maintain than rentals that are more your style.
Analyze Neighborhood Characteristics for a Rental Property
Property managers know that one of the best reasons to invest in the DFW metroplex is the wide variety of inventory to fit almost any residential real estate investment portfolio. Evaluate each neighborhood and its characteristics before purchasing a home to make sure you're prepared for maintenance costs, potential problems, and types of renters.
The Frisco area hosts a variety of neighborhoods and characteristics, including proximity to community colleges, universities, and other educational opportunities. While this can be an excellent opportunity for a steady stream of renters, a Frisco property manager will advise that it can also become a problem if you're not ready to house student renters (and some of the issues that can entail).
Young renters can be late to deliver rental payments, break the lease rules with noise violations or too many occupants, and cause property damage (even accidentally). Plus, investors who choose housing that primarily serves students deal with frequent tenant turnover at the end of semesters or school years. Working with a Frisco property management team can be the best solution for dealing with rentals that house students and everything required to maximize returns for those properties.
Review Crime Rates
Like many homebuyers who consider safety and security before purchasing a home, renters (and rental owners) must also research the crime rates in a location before renting a property. If crime rates are high in a specific area, even a quality home with excellent amenities won't attract quality residents who stay for more than one lease term.
Be Aware of Frisco TX Ordinances or HOA Restrictions
Not all neighborhoods are rental-property-friendly. Take time to learn local Frisco ordinances or neighborhood-specific rules that could make it difficult to turn a profit on your property. Some HOAs might try to discourage renters and rental owners by imposing high fees, challenging permit requirements, and too many rules to make it worth your while. You'll also need to work with residents to make sure they comply with HOA rules while living in your rentals. A property manager can help you navigate permits, restrictions, and tenants to make sure your rentals comply with the rules.
Work With a Property Management Company
Finding the neighborhood data you need to analyze a rental or specific area can be challenging without the right resources. Consider working with a Frisco property management company to deliver the data and market research you need. With an experienced property management team, you gain access to the information you might not be able to get with online searches or county appraisals. Plus, the right property manager can help you interpret data and avoid bad investments.
A Property Manager Helps Investors Choose the Best Neighborhoods and Properties
Maximizing ROIs requires excellent properties in good neighborhoods that appeal to quality residents! When rental property owners deliver quality homes in desirable areas of Frisco, they experience better returns.
RentHub's expert property management team is here to help you review properties and neighborhoods to find the best investments for your real estate portfolio. We also deliver expert property management services for single-family and multi-family rentals. If you're considering your next (or first) property, give us a call, and we'll deliver our best expert insights and rental analysis to help you make a smart investment. We also manage your Frisco rental and maximize your return on investment!
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