Apartment Buildings For Sale
// October 2nd, 2009 // Real Estate
If you do the math on apartment buildings for sale, you know that there is money to be made in this type of investment property for sale. Say, for instance, you spot a real estate investment property in New York City that holds 100 units in an area that commands $1,200/month. If all units are occupied, that’s $120,000 in your pocket! Well, of course you’ll have to cover capital gains taxes, property taxes, mortgage payments, insurance, repairs and grounds maintenance, all of which eats away an enormous chunk of cash. Even so, most successful apartment building owners can earn over $100,000/year after all these expenses are covered.
The quality of an apartment building largely depends upon the neighborhood it’s in. The goal of any commercial real estate investing is to have 100% occupancy, which is only really possible if you’re situated in a low-crime part of town that is conveniently located near bus stops, retail centers, gyms, movie theaters, restaurants and grocery stores. Tenants with children will be looking for properties that are near schools with good reputations. If you’re unfamiliar with the neighborhood you’re looking to buy in, then you should check out a site like www.city-data.com to gather some valuable statistics about the area where you’re considering investing in real estate.
When buying apartment buildings for sale, you’ll want to look at every possible factor that could cut into your profit margin, including property taxes. These taxes are not evenly cut across the board, so you’ll need to look into this additional expense. Often, city taxes are cheaper than suburban taxes because there are more households paying for road services, trash pickup, schools and other local expenses. In the far-flung, richer parts of the city there are less people to cover these expenses. Although, on the other hand, commanding higher property taxes can also keep out some of the riff-raff and will guarantee better schools, so it’s really up to you to determine if the extra cost will earn you money in the long run. You can visit the town’s assessment office for information on local taxes.
Don’t sweat the financing of your first apartment buildings for sale. Many people shudder at the thought of a down payment on such a large investment; however, there are numerous programs offering 100% financing because local governments want neighborhoods revitalized. Investment property loans are plentiful and even if you have the money, it’s sometimes more advantageous to invest in multiple properties rather than tie all your money up into one real estate investment property. To find out more about financing, visit your local bank or credit union to ask about programs for which you may qualify.
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