Ferrari-Lund Real Estate South
Ferrari-Lund Real Estate South
Sheri Barnes, Ferrari-Lund Real Estate SouthPhone: (775) 745-6425
Email: [email protected]

When Should You Think About Investment Properties?

by Sheri Barnes 06/12/2019

Okay, so you’ve been watching all those home shows and think you want to invest in a second property, but that whole flipping business seems like more trouble than you want to handle. First, you have to budget correctly for the remodel, then it absolutely has to sell, and quickly, otherwise, it stops being a good investment. There is an alternative: keep it as a second property and lease it out for additional income. 

Depending on what kind of rental you want to own, you will want to look at different properties and price ranges. Your real estate agent can help you choose what’s best in your neighborhood.

Standard or Long-Term Rental

For best results, you want your rental home to land smack in the middle of the neighborhood's price bracket. That means calculating your mortgage, taxes and all other included expenses and making sure you can make an income while keeping the rent reasonable. Middle-of-the-road rental prices will get you the best tenants. They will fit into the neighborhood and are more likely to be comfortable there, which means you can probably keep them longer. Each time you turn over the property between tenants, you not only lose the income for that time but incur the extra costs of preparing the property for the new renter. The longer you keep individual tenants, the more profit you make.

Vacation or Short-Term Rentals

Vacation rentals differ from standard rental properties in several ways, but the most common differences are (a) the nightly rate, (b) how often you have tenants, and (c) the range of turnover requirements and costs. Vacation rentals—growing in popularity for a while now—might be your chance to cash in on the craze. Guests prefer them because they can usually get more space for a lower cost than a hotel, fit more people together in a single area and prep their own meals. This makes them particularly popular with families and groups with children.

You'll need to keep your vacation rental furnished and cleaned which increases the costs initially, but if you can keep guests scheduled regularly, the profit margin can be substantial. You can vary your rates depending on the length of stay, catering to stays a short few days or up to three to four months and anything in between. Make sure to check with your local municipality for regulations on short-term rentals in your area.

Don't forget that you can use it yourselves as well, just be careful not to leave too many personal effects there, it can break the ambiance for your guests.

New Property, New Job

The most significant difference between keeping your investment property and flipping it is that you get a second job: Landlord. This is not a position for everyone. First, if you've ever been a renter, you know how difficult it can be if your landlord is in a different city or even a different state. If your property is out of town, investigate getting a property manager. If your property is local, you may want to handle it yourself, but if it takes too much time or causes more stress than it alleviates, you may wish to hire a property manager as well. A good manager will handle interviewing and advising renters, running credit approvals, collecting payments, some landscaping and maintenance, and turning over the home between tenants. Make sure you include this cost when you calculate your necessary rental expenses.

So, ready to invest? Your real estate professional should be your first call! Put their local knowledge to use in finding the best properties for rental investments.

About the Author
Author

Sheri Barnes

Buyer & Seller Agent

PERSONAL

Born and raised in the Sacramento area (Fair Oaks), real estate has always been "in my blood" perhaps, due in part to growing up in a builder family. I graduated from Bella Vista High School, attended California Lutheran College, later graduated from CSUS (Sacramento) with a degree in Communications and a minor in Business Administration. In 1993, I moved to Reno to work for a Fortune 500 company and obtained formal sales training. I've always been involved with some sort of extra-curricular activities including sports, music, dance and theatre. My current hobbies include spending time with my family, gardening, an occasional game of golf and volunteering with various youth programs and organizations. I'm Past Chairman of the Board of Trustees of Mountain View Montessori School. 

PROFESSIONAL

Real Estate is my business, my only business. I have been a full service realtor with over 24 years of experience. My focus is helping my client achieve their real estate goals, whether they are first-time homebuyers, Seniors, buyers/sellers, investors, short sales or relocation. I specialize in new construction communities and residential resale in Washoe County.

I truly love this area and take great pride to know much more, than that which is expected. Every transaction is unique and can often require a creative solution to get results. I'm a customer driven Realtor dedicated to achieving results and providing exceptional service. I feel that this is the reason I receive an abundance of referrals from past clients.

As a buyer’s agent, I listen to my client’s goals so I can find the perfect home and NEGOTIATE the best price and terms that fits their needs. As a seller agent, I know that pricing, location and condition are key factors in selling homes for the highest price possible. With this in mind, I create a customized marketing plan specifically for your home.

Please feel free to call, text, or email me with any questions, anytime.  

CERTIFICATIONS AND RECOGNITIONS

REALTOR® Certification

CDPE Certified Distressed Property Expert

SFR Short Sale And Foreclosure Resource Certification

GreenRE Certified

Member National Association of Realtors

Member Northern Nevada Regional MLS

Consistently in the Top 10% of Producing Realtors in Northern Nevada