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1. Compare Property Values and Rents
Its great to have financial statistics, but they can only take you so far. One of the best measures of a property market value might be the sale prices of neighboring property with similar criteria. The same holds true for area rents. Find out what is on the market in the vicinity making sure you consider the location as well.
2. Tax Laws are forever changing!
Basing your decision to invest should not be solely based on the current tax laws in the state of Oklahoma. As we have recently seen, tax codes are always changing. Consult a Tax professional yes, but understand the right property with the right financing is the ultimate goal of a serious investor.
3. Invest in something you understand
If your new to investing in real estate, begin with something you know something about. If you have experience with fixer-uppers, foreclosures, starter homes, low-down payment properties, condominiums, or small apartment buildings, you'll benefit from experience by understand what is involved and can focus your energy, time and money in one aspect of investment real estate properties.
4. Ask questions AND Understand the Answers!
Know the financial statements inside out or be sure your real estate investor does. Ask lots of questions; What are operating expenses? What are loan payments? Vacancy costs? Taxes? What does the cash flow statement look like? These are all key issues that must be addressed before you and your broker start the transaction process. It is also the core of a solid successful investment.
5. Rental Property Has other issues to consider
Be sure to understand when the last rent increase was. If it was recent, tenants already living on the property may be considering a move. If any of the currant tenants have a short-term lease, they may be living there simply as a favor to the present owner to attract unsuspecting investors. Go over the tenant history, have the owner show how long tenants have been there, any complaints and so forth. It is also important to collect the tenant's security deposits at closing. Mick can go over other legal aspects of buying a rental property and how the law deals with the transaction in the state of Oklahoma.
6. Tax situation can possibly be changed to your advantage.
Since taxes are an integral part of real estate investing, they cannot be ignored. However whatever the situation is at present, may be manipulated to your advantage or may not! Consider this could make the difference between a positive cash flow and a negative one. Know the tax situation, it is always a good idea to consult a tax adviser who is familiar with the laws in Oklahoma.
7. Investigate insurance coverage on any investment property.
If the seller's coverage was based on a lower purchase price or replacement value, your insurance cost may increase when you pay a higher purchase price. Check to see if the insurance company will transfer the coverage or if you need to apply for new coverage.
8. Verify ALL Utilities of a particular property.
Call the utility companies to verify recent utility expenses. It is also imperative to consider what, if any of the utilities costs are included in the tenant's monthly rent.
9. Go over the Tenant Agreements!
You must also be aware of differences in each of the tenant agreements. If contract qualifications, or lease agreements have changed recently you may have to honor different sets of agreements per tenant.
10. Do Not inspect the property alone!
Make sure that you always perform a thorough inspection of the property before and after buying it with another set of eyes. Your real estate broker and a knowledgeable friend or co-worker would be a good idea. In some cases the property may be out of your area and a professional inspector may need to be called in. In some cases a structural mechanical system inspection may need a separate investment.
These are the most critical things to consider when starting out with investments in the real estate industry. There are other things we would be happy to discuss with you on a more personal and case by case investment. Everyone is certainly talking about Flipping Homes as a fast cash way to invest. WARNING!!! They don't show you everything that goes into flipping on the TV shows. Give us a call, we will be happy to speak to you!
Mick Corbin Claremore Investment Real Estate | 
