If you want to purchase a home with an eye towards its future value and investment potential, then you need to evaluate properties in a different way than you would when buying a family home.
There are many different factors affecting residential real estate prices and investment potentials. Knowing these factors and keeping them in mind will help to ensure the property you purchase performs well as a long-term investment.
To this end, below are some tips for purchasing residential real estate as an investment:
Tip: Choose Property Located as Close to the City Center as Possible
The price of residential real estate in any city tends to drop as you move outward from the city center. Housing in the very center of town has the highest prices, while housing located farther away tends to be cheaper. Typically, this is due to the fact that living in the middle of town cuts down on driving time to get to work, restaurants, and shopping locations.
If you want to purchase a home that will increase in value over time, then buying as close to the center of town as possible is often one way to ensure that will happen. While all real estate will likely increase as the years go by, higher-priced real estate in the center of town will often gain a lot more value as the city continues to grow and expand outward.
Tip: Opt for a Home Near a Very Highly-Rated High School
In every area, there is one high school known for having the best educators, afterschool activities, and sports programs. This highly-rated high school continually churns out young adults who are accepted to the best colleges and go on to play professional sports.
If you look at a map of property values, you will see a cluster of higher priced homes surrounding this special high school. Prices around the school are higher because parents flock to the area and fight for housing in the district so their kids can benefit from a great education.
When buying a home as an investment, purchasing near the "it" high school is always a good choice. Even if you don't have kids who will attend the school, it's presence will keep your property value elevated.
Tip: Choose a Real Estate Agent with Investment Property Knowledge
Lastly, when you are purchasing property with an emphasis on future value and investment, it's important you work with a real estate agent with investment property experience in your local area.