The DC rental market is a competitive one. Numerous people are looking for access to high-quality single-family or multi-family housing in the area. Rental prices are quite high, compared to other markets—and even with a slight decline in demand from COVID-19, the DC area is still strong.
Could this be the ideal place for you to grow your investment portfolio? It could be—if you know the basics of investing in real estate here in our nation's capital. Developing strategies as a property owner is generally the first step. Plus, your trusted DC property management team at Renters Warehouse can help you along the way.
Property Investing 101: Class Is in Session!
Real estate tends to be one of the safest investment strategies today, even during a global pandemic. There are risks to it (as with all investments), but real estate has historically served as a portfolio stabilizer—especially in volatile stock markets. Yet, you still are making a sizeable investment in DC rentals; that means you need to make wise decisions.
The first step, then, is to 'get to know' the market. The median list price of a home in this area is around $650,000. That is about $538 per square foot. You can find real estate deals for much less than this with insight from the right partner, but having a general understanding of what you're walking into will prepare you as a property owner. Get comfortable with the research now, because it's a tremendous ally when purchasing a rental property.
- A down payment for the property in question
- Having the excess funds to handle any necessary renovations, and
- The means to manage the property successfully (including preventative maintenance)
Since it presents an increased risk. How can you pull all of this off?
What You Need to Do to Invest in DC Rentals
If you plan to be successful in real estate, there are a few key areas you need to focus on as a property owner. You can eliminate many of these concerns and reduce risk by working with a skilled DC property management company. If you decide to operate alone, here are a few key details that can make a difference.
The First Property Needs to Be a Good Experience
This is important.
- You want to ensure your investment property is one that is going to offer you a good experience and long-term returns as an investor.
- It should be one that does not require a lot of hands-on renovations and should be priced well from the start.
- Having an easy rental property to get started with ensures you get the best feel for the business, and you do not drain your capital too quickly.
From here, you can work on sustainable property growth. Your first experience in the DC rental market can make a big difference as to your overall success.
Part of picking the 'right' first property also depends on your research, so reach out to an expert DC property management team like Renters Warehouse if you need support in this arena.
Know That Renters Are Different From Homeowners
Most often, property renters want affordable quality. They are not looking for a home that is luxurious and filled with top-of-the-line amenities (think Viking ranges) unless they're seeking downtown living. Outside of this clientele, many are looking for a bread-and-butter home either in or around the DC area (think Arlington, Alexandria, Ashburn, and Fairfax).
On the other hand, homeowners want the ideal property where they can put down roots and make the space their own. They expect to customize their space. Renters, by contrast, want good appliances, a clean, open space, and an 'invested' property owner that's timely with handling maintenance requests and care.
Location Is a Primary Factor
Getting to know the DC rental market is an important step in ensuring you can attract the right type of renter to your space. Location matters to renters: No one wants a long commute (and yet, many times, this is what they have to do).
- You also want to ensure you are investing in the right neighborhood!
- Get to know what a rental property in the DC area goes for.
- Find out what features are important to your renters.
When you discover what they expect to find in the location you are buying a home in, you'll attract high-quality residents during your tenant screening process.
Screen Your Renters
- No matter how good an application looks, it is critical to screen prospective renters well.
- This means taking a look at their rental history and background.
- You need to know about their credit history because it directly impacts if they will make payments on time.
Work With Property Management Services
Working with a DC property management group is one of the most important steps to take if you are new to the DC investing scene. You should hire a property management company early on to handle as much of the process of acquiring and preparing your new rental property as possible.
A skilled property partner like Renters Warehouse can help you with most of your needs, including:
- Finding the ideal property to rent
- Pricing the rental property you do choose
- Marketing and leasing services, like screening
- Keeping an eye on preventative maintenance and requests
- Building your lease agreement and offering investment strategies.
At Renters Warehouse DC/NOVA, we get that property investing is an exceptional way to build a profitable future. We also know your chances of excelling improve when you work with our Rent Estate™ Advisors! Now may be the right time for you to make your move with a bit of help and support from our team.
Learn more about how to grow your long-term returns by reaching out to our Rent Estate™ Advisors today! You can also discover excellent ways to grow your portfolio with your copy of our free resource, Real Estate Investing: Grow Your Portfolio.