Birmingham Rental Properties

It seems that every day we are getting calls from Real Estate investors who are considering investing in Birmingham. We get questions like:

“What are the best areas to purchase properties”

“What should I expect for my rate or return”

“I am from out of state. How do I know my properties will be taken care of”

“How can I get financing to buy rental properties”

These are just a few examples of questions we get almost daily. Each of these questions can be very subjective based on who you are talking to. For example, what I consider a bad neighborhood could be considered a great investment opportunity by another investor.

I have listed a few recommendations that new investors, or investors new to Birmingham should consider:

1- Determine what you want– Do you want A class properties, B class properties, C class properties, or something else? Are you looking for cash flow or appreciation? Are you willing to pay cash, or will you need financing? All of these are questions you should ask yourself initially before investing in any Birmingham property.

2- Set your expectation realistically- If you want to invest in C class properties you should realize that you are going to take on more risk than if you invest in A and B class properties. If you buy A and B properties, you will not get as high cash flow as you could expect on C properties.

3- Get to know the numbers- Obviously you should know the rent and price, but some investors forget to account for taxes, insurance, property management, city fees, and maintenance. Knowing these numbers will help you set a more accurate expectation for you property.

4- View the properties- If you are a local investor, it should be easy enough for you do do a drive by to see the property from the outside. If you would like to see the inside, just contact the owner and they should be happy to set an appointment. If you are from out of state, I would encourage you to come to Birmingham and get with a local turn key provider to show you multiple properties under construction, finished properties, and properties that are already rented. Seeing rented properties will help you to understand how a tenant will take care of your property. If you are from out of town, I would recommend that you schedule several days with a turn key provider who can show you different areas and how many areas can vary in quality from street to street. Once you have an established relationship with a turn key provider, you may elect not to view the properties, but the provider should still give you plenty of good, clear photos.

5- Know the scope of work- If you know that your property has a new roof and HVAC, you shouldn’t expect to have repairs associated with these items in the near future. If your property has a long term tenant, most likely the property will not have been fully rehabbed recently, but you can have more assurance that your tenant likes the property and will not be wanting to move soon.

6- Expect Expenses- As with any property, there will be expenses from time to time. Leaky sinks and clogged toilets happen. This all comes with owning Real Estate.

If you are interested in purchasing turn key rental properties in Birmingham, give us a call at (205)746-1918.