Investing in real estate is considered to be one of the best ways to go for anyone with a larger amount of capital. You get an almost guaranteed return due to a high demand housing market, high rental rates, and a steady influx of new jobs. Woodinville is also just outside of Seattle, and therefore a great place for families to live, so you can expect to get the higher-end tenants with an average income of $50-150,000 per year. If you’re considering investing in property in the area, here are a couple of the pros and cons to get you started.
We’ll get started with a few of the many reasons why you would want to invest in real estate.
Investing in real estate creates tangible assets. You won’t have to trust a bank to keep your money, or interest rates, or even trust your stock broker. You will own a tangible asset in the form of a building.
The cost of living in the Seattle area may be 170% that of the rest of the United States, but that means good things for the value of property. While it’s not guaranteed, property value almost always goes up, especially when the population increases. Because the Puget Sound area is in the middle of a growth spurt and an industrial boom, that is highly likely to happen. property appreciation means that you’ll be able to sell your investment for more than you paid for it.
Real estate, especially rentals, are a relatively stable market. So long as you can keep advertising and filling units, you can keep making money. Even if you eventually have to accept lower rates, you’ll still be making money back. Plus, once you’ve paid off the investment, everything is pure profit.
As with any investment, there are a couple of cons to investing in Woodinvilel real estate. Luckily, there are only a few.
Liabilities & Accidents
Accidents happen and whether it’s the fault of the tenant or a natural disaster, you can expect it to cost you money. Liabilities like lawsuits, unexpected maintenance fees, and other issues all cost money, and sometimes more than you may have planned for.
Tenant management can vary between the occasionally lucky and blissful experience to pure hell. If you want good tenants, you have to take the time to screen them, do background checks, and call references. You’ll also have to manage than and work with them over time, and that means doing any necessary maintenance on the unit, responding to emergency calls at any hour, and handling monthly paperwork and rent collection. It is a lot of hassle but it’s a major part of managing property.
Marketing is a huge issue with real estate investment because without it, you can’t rent out units. No one will rent a house or apartment that they don’t know about. You have to take the initiative to get the unit online, in newspapers, and anywhere that you think a potential tenant will see it. Otherwise, you’ll have vacancies and you won’t make money.
The good news about investing in real estate in Woodinville is that there are easy ways to balance out the cons. For example, you can invest in property insurance to cover the costs of accidents, natural disasters, and other liabilities. You can also find a local Woodinville property management company to handle the tenant management, marketing, and paperwork for you.