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How to Select the Best Investment Property

November 18, 2014

rental home in ChicagoSearching for an investment property can be a challenge as the popularity of investment real estate has increased. However, as one of the only investment opportunities that generates a significant return while you still own the asset, purchasing real estate to rent is still an attractive option that many homeowners in Chicago choose to pursue.

In the new article “

What to Look For When Buying an Investment Property” on the Equifax Finance Blog, potential investment property buyers can learn what makes a property a good option for renting.

One of the primary indicators that a property will remain a good investment is its capitalization, or cap, rate, which compares the annual net operating income to its capital cost or current market value. The higher the cap rate, the more profitable the rental property will be.

While cap rates are a quick, easy way to compare the profitability of a rental property, they are certainly not the only factor that should be taken into consideration. It’s important to familiarize yourself with the property itself and determine if there will likely be any changes in its value. Also, be sure to review the local economy to ensure that job opportunities are available, as a stronger economy will likely provide a continual stream of renters.

If you’re searching for an investment property that can be used as a rental home, be sure to read the full article for more information. You can also visit the Equifax Finance Blog to learn more about personal finance, credit, taxes, retirement and insurance.

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Courtney Rogers

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