First Rental Property

Hi Friend,

I hope you are doing well.  As a new real estate investor, I know that you have many questions as to how to get started with investing in real estate.

One question that you may have on your mind is, ‘Where is the best place to buy a rental property?’

If you have that question on your mind, you are not alone.  In my experience, that is one of the most common questions asked by new real estate  investors.

When I first started as a real estate investor, I did not know where exactly I should be purchasing my first rental property.  I ended up purchasing Oakville real estate, and have since gone on to add to my portfolio by owning Hamilton real estate and Toronto real estate.

Another very important questions that is asked by new real estate investors is:

Is The Cheapest Property Always The Best Deal?

My answer to this questions is:

It depends…

It depends on a couple of important variables, and these variables are…

1) The tenant profile 

and

2) The condition of the property

The Tenant Profile

Some new real estate investors are attracted to buying the ‘cheapest’ property in a given city of town because they have a limited down payment.  More often than not, when you are started out as a real estate investors, you do not have lots of money to put down towards a down payment.  Some people begin to think that in order to ‘get into the game’, they have to buy the ‘cheapest’ property because they are limited by how much money they have to put down.

This is the wrong mode of thinking. Just because a property is ‘less expensive’ than others, does not make it the best option for you to purchase.  In many real estate markets, the ‘cheapest’ properties have the most challenging tenants.  Cheap properties bring with them cheap rents.  When you have ‘cheap’ rents, you can very possibly have high maintenance, and difficult tenants to deal with.

If you are limited by how much money you have as  a down payment, never make the error in purchasing a ‘cheap’ property simply because that is your only ‘option’.

The condition of the property

All things being equal, cheap properties are cheap for a reason.  The fact that they are less expensive can stem from the fact that they are in poor condition.   You should avoid buying  a rental property, and especially your first rental property if it requires massive repairs and maintenance.  Cheap properties require work to be done to them.  Unless you have lots of experience with repairs and maintenance on properties, avoid buying one that is in poor condition.

In summary

The lesson to learn here is as follows:

If you are a new real estate investor and you have a limited down payment for the purchase of your first rental property, don’t rush the process.

Do not feel that ‘in order to get into the game’ you have to purchase the cheapest rental property out there, because that is all you can afford.

Take special note that with ‘cheaper’ properties you purchase, other issues arise.

Cheapest is not always the best.

Happy Investing!

Best Regards,

Neil Uttamsingh

ps: Remember, I am an experienced real estate investor and Licensed Realtor.  I help new real estate investors like you purchase their first rental property.  If you would like to buy Hamilton real estate, Oakville real estate or Toronto real estate, send me a message at NEIL@FIRSTRENTALPROPERTY.COM and I will help you get started.