So where do you start?
This guide explains.
Make a List: How to Find the Perfect Investment Property in Silicon Valley
As you search for an investment property, you probably have a set of goals you want to reach. Naturally, you want the property to be profitable; you also want it to be safe, relatively easy to maintain, and certainly easy to rent to tenants (or to flip and sell). During your search, look at:
- Homes that fit in your price range
- Investment properties in potentially profitable locations
- Houses that will generate income, either by flipping or renting
- Homes that are structurally sound
Here’s a closer look at each.
Homes That Fit in Your Price Range
Ultimately, price will likely be the biggest factor in whether you can buy a multifamily property for sale in Silicon Valley. Your REALTOR will show you homes that fit within your budget – and help you negotiate with sellers to get the best possible price.
According to a recent study, as many as 26 percent of buyers go over their initial budgets. After you’ve created your budget, stick to it – even if you want to “squeeze” to make things work. There was a reason you created a budget in the first place!
Investment Properties in Potentially Profitable Locations
Location is exceptionally important when you buy an investment property. You need the home to be in a neighborhood that’s easily accessible, close to major amenities, and certainly filled with favorable community attributes that renters will enjoy.
Generally speaking, homes closer to core downtown areas have the potential to generate more income than those that are farther away. Renters expect to pay more for proximity, too, so you can ask fair market value if you choose to rent out the units in the home. Likewise, if you’re flipping an investment property, you’ll most likely be able to sell it for more if it’s closer to downtown.
Check out the walking distance to local amenities, such as shops, restaurants and public transportation, as well. Generally, people tend to prioritize these things and are willing to pay more for easy access.
Houses That Will Generate Income for You
Even in a buyer’s market, an investment property can end up costing more than you think it will. Remember that:
- If you use an adjustable-rate mortgage, or ARM, your monthly financing costs can rise
- Your property taxes will increase as the value of the investment property increases
- Maintenance costs will inevitably rise, and they may do so sooner rather than later if the property isn’t brand-new
- Tenants can move out, pay rent late or even default on rent payments – and that interrupts your cash flow
Homes That Are Structurally Sound
No matter how close a property is to the downtown area and amenities, or how attractive it is from the outside, you need to ensure that it’s structurally sound before you make an offer. The last thing you want is to be stuck with an uninhabitable building on a mortgage that you have to pour thousands (or more) into – so talk to your REALTOR about finding a property that’s in decent shape.
Don’t worry about cosmetic issues; if you’re under budget, you may be able to make minor repairs and upgrades, or you may be able to ask the seller to handle them for you.
Are You Buying or Selling a Duplex, Triplex or Fourplex in Silicon Valley?
If you’re selling a duplex, triplex or fourplex in Campbell, Cambrian Park, Los Gatos, San Jose, Santa Clara, Saratoga, Willow Glen or another community in Silicon Valley, we’re here to help. Call today or fill out the form below to find out about our innovative marketing plans that can put your investment property in front of all the right buyers.
If you’re also looking for a new multi-family property for sale or another type of home, check out our: