In this post I want to continue talking about the various costs incurred when dealing with investment properties. As we all know, pulling real estate comps helps us find out neighboring home prices. But, what we pay for a property will help us determine what rental prices should be if we decide to rent the property. One thing we may not account for is tenant turnover. We have previously found the biggest surprise to be the expense of tenant turnover. This includes advertising for a new tenant, cleaning, repainting, replacing carpet, etc. If you expect to have high tenant turnover, like next to a college campus, anticipate this cost to be significant.
Insurance on investment properties are typically higher than owner occupied, single family properties. So get an insurance quote on the property instead of basing your estimate of cost off of the insurance bill for your house. Purchasing liability insurance is also wise although it can be expensive. Doing this extra bit save you worry in the long run.
Ok guys that’s all for today. Check back tomorrow for my wrap up on investment costs when I plan will discuss maintenance and utility costs.