Advice for Someone Who is Looking to Purchase a Duplex
When the thoughts of purchasing a duplex start to creep into your head, it is important to take the time to consider all of the implications of this type of investment. This will help you know what to look for when you start your search and ensure that you make the right decision. Below are some important tips when it comes to buying a duplex.
Research the Local Market
Before you even start looking for a property, you must research the local market conditions. This will help you to get an idea of what type of prices to expect when you start your search and also give you an indication of the rental income potential in the area.
If you are looking to purchase for investment, researching is especially important since you need to ensure the rental income will cover your mortgage and other expenses. This is also crucial since you may not always be able to use the duplex for personal purposes.
Get a Property Inspection
You should get a property inspection carried out before signing any contracts. This will help you identify any potential problems with the property that could cost you more money down the track.
During the inspection, ensure the inspector looks over both units of the duplex – you want to be certain that there are no hidden issues. They should also thoroughly check the roof and foundation, as these are two of the most costly issues to fix.
During the inspection, they will also check if there is enough space for all your property like your commercial laundry equipment, large appliances, and more.
Consider the Neighbourhood
When purchasing a duplex, you must be mindful of the neighborhood. Ideally, you want an area with low crime rates and well-maintained properties as this will ensure that you have reliable tenants. You should also consider the purpose of the duplex; if it is for investment, you may want to look in areas with lower property prices and higher rental yields.
You should also consider the surrounding amenities such as schools, hospitals, and transportation links. For example, if the tenants have children, then you should ensure that there is a nearby school.
Look at Your Financing Options
When it comes to buying a duplex, it is important that you are aware of your loan options. Traditional mortgages may not be an option if you plan on living in one of the units as most lenders will not finance such a property. In this case, you may need to look into an investment loan to finance the purchase.
It is also important to calculate your outgoings so that you budget for mortgage payments, insurance, and any other costs associated with the ownership of the duplex.
Follow Local Laws and Regulations
When buying a duplex, it is important to ensure that you follow all local laws and regulations regarding rental properties. These regulations can vary from state to state, so it is important to do your research and ensure you comply with all of the laws.
This can include things like having an appropriate rental agreement in place and ensuring that your property meets all of the safety and health requirements in the area. It can also include ensuring that you have the appropriate insurance coverage in place.
Work with a Reputable Real Estate Agent
When looking for a duplex to purchase, it is important that you work with a reputable real estate agent. This will help ensure that your search is a success, as the agent will be able to advise you on what to look for and help you find the best deal. They will also ensure you get the duplex you are looking for.
They will also be able to guide you through the purchase process, helping you understand all of the legal documents and paperwork involved. Working with a reputable agent can save you time and money in the long run.
Avoid Rash Decisions
Finally, it is important to remember that buying a duplex is a big decision and should not be taken lightly. Make sure that you take the time to consider all of the factors involved and that you are making an informed decision. Take your time when researching properties and don’t rush into anything.
By following this advice and doing your due diligence, you can be sure that you are making the right decision when purchasing a duplex. Investing in a duplex can be a great way to generate passive income and secure your financial future, but only if you do it properly.