Wealth generation comes in many different forms, including rental property investments. As with any investment, there is some risk.
When you purchase a rental property, you need to ensure it can provide you with a return on investment. To do this, follow these tips for choosing the best investment property in Albuquerque, NM.
1. Property Taxes
Property taxes vary across target areas so you'll want to be aware of how much you'll be losing when purchasing an investment property in Albuquerque, NM.
High property taxes aren't always a bad thing if you invest in a neighborhood that attracts quality long-term tenants.
The county's average property tax rate is 1.05%, which is the second highest in the state. Since the area is attractive to renters, you'll reap high returns.
2. Crime Rates
An investment property in Alburquerque won't do well near a hot spot of criminal activity. You can find local crime rates and statistics for neighborhoods in the area through the police or public library.
There are 28,171 property crimes annually in this area. However, purchasing investment properties in safer areas reduces the risk. Some of the safest Albuquerque neighborhoods are:
- North Albuquerque Acres
- Sandia Heights
- High Desert
- Glenwood Hills
- Antelope Run
When choosing an Albuquerque investment property, it's best to invest in one of the top areas to find success.
The best investment property is one near plenty of amenities like gyms, restaurants, parks, movie theaters, etc.
You can also look into future development when buying property. A municipal planning department will have information on plans that have been zoned in the area.
If you see a lot of construction, there is likely to be upcoming growth. Be wary of new developments that could hurt the price of an existing surrounding property.
4. Number of Listings and Vacancies
Another important factor to consider when learning how to choose an investment property is the number of listings and vacancies in the area.
If the housing market has a high number of listings, it could indicate a decline.
High vacancy rates force landlords to offer low rent prices to attract tenants. An area with low vacancy rates will make you the most money because you can raise rents.
5. Average Rent Prices
Rental income is how you make passive income as a real estate investor. Before choosing a rental property for purchase, know the average rent price in the area.
The property you consider needs to bear enough rent to cover expenses like taxes and mortgage payments. Research the area to get an understanding of where it is headed in the years to come.
If you can afford the area now but notice that taxes are expected to increase, this now affordable property could cause bankruptcy in the future.
Choose an Investment Property in Albuquerque, NM
The hardest part of becoming a real estate investor is purchasing properties that lead to a return. To choose an investment property in Albuquerque, NM, it's important to make the above considerations.
Hiring a rental property management company can help you make an investment decision that leads to success. Contact us today to discuss our properties and the services we offer.