Nearly 1 in 8 Americans call apartments their home. As this number increases, it creates more opportunities for anyone who wants to invest in apartment real estate.
Before getting a mortgage on an apartment, you’ll want to know how to choose the right apartment real estate.
Read through this guide to find various factors that you should consider when buying an apartment.
1. How Old Is the Building?
The building’s age will play a huge factor in whether you should buy an apartment. That’s because an older building will likely require more replacements and repairs. This could cost you more in the long run.
Before buying any building, you should obtain an engineer or architecture report. In these written reports, you’ll find a list of every issue an inspector found.
2. Apartment Resale Value
When buying an apartment to resell, you’ll need to ensure that you can flip a profit in the future. Various factors will influence its desirability like:
- Whether the building is owner-occupied
- If it’s a freehold apartment: these are easier to sell
- The building’s location
Unless the market becomes saturated, apartments in cities will usually have a great resale value.
If you’re interested in buying an apartment in the Midtown Miami area, learn more about one of the city’s coolest buildings.
3. Where Is It Located?
When you buy apartments near transport, beaches, libraries, and other important places, that impacts its desirability. The way the apartment faces also makes a difference in how much natural light an apartment receives.
Many consider south as the best facing direction for apartment living.
4. The Apartment’s Community
Research the community and the building that you’re interested in buying. Learning about their culture will give you insight as to whether buying an apartment is the right decision.
Take some time to understand the existing by-laws. Figure out what rules are in place for communal areas, pets, and noise. Talk to your agent about the strata committee, the building manager, and the staff.
If possible, talk to some of the tenants.
To determine whether a building is right for you in this regard, consider the following. If most of the occupants are investors rather than occupants, this factor could impact how future buyers view the building.
5. Maintains an Ideal Occupancy Rate
Don’t buy an apartment that has an occupancy rate below 70%. Anything below can signify that the apartment has issues. Whether it’s mismanagement or a location that’s undesirable.
Because of these factors, you would need to invest significantly more money to run a profitable apartment.
Buying an Apartment Isn’t Difficult
Buying an apartment requires you to pay attention to various details if you want to make a profit. Pay attention to the apartment’s history and research its location. If all of the signs don’t tell you that it’s not worth buying, you should keep searching until you find the right building.
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