Investing in single-family rental properties can be a bit of a struggle in so far as it concerns saving up for the down payment. You’ll need at least 20% of the purchase price saved up, plus a little extra for closing costs, insurance, and repairs. But really, don’t be worried; there are plenty of proven strategies to make saving up for your next investment property faster and easier, and I’m eager to help you consider those options.
Quick Start to Saving for a Down Payment
One of the most suitable ways to start saving money for your down payment is to prioritize saving over spending. Conceding that it sounds like common sense, it can be complicated in practice.
Saving money can be a real struggle, especially when it denotes putting off some of the things you really intend to buy. But definitely, if you truly like to save up a significant amount of money, it’s important to create specific goals, draft a plan, and then execute it. Examine automating your savings to make this process lighter. Have your paycheck split between accounts, or set up automatic transfers.
If you want to increase your savings, paying off any debts you may have is an excellent way to begin. Think of it this way: Every month, you’re putting money towards paying off debts instead of saving for your future property. Once your debts are cleared, you’ll be in awe at how much more money you have left over at the end of each month.
No more worrying about debt and interest payments sucking dry your hard-earned income. If you do use credit cards, only spend what you can pay back each month. Many different credit cards offer cashback rewards that will help you save significantly more; this can be a huge advantage for responsible credit card users.
Assess the Cost of the Desired Property
To properly begin, research the real estate market in your preferred location to understand current property prices. Think about the type of property you want (for example a single-family home, condominium, or multi-unit building) and what facets matter most to you (size, amenities, and location).
Once you’ve found a list of chosen potential properties, take note mindfully of their listing prices and any extra costs that come with buying a home, such as closing costs, taxes, and fees. Do not forget to assess potential ups and downs in the market and any unexpected expenses that might pop up during the buying process. Always remember, it’s better to be fully prepared than caught off guard.
Set Reasonable Savings Goals
Setting up short-term goals is one of the most efficient ways to save up for a down payment. Instead of just going after the large sum of money you need to purchase your next investment property, focusing more on smaller, attainable goals is more practical.
For instance, you can get started by planning to save a specific amount each week or each paycheck, even if it is just $25 or $50. By keeping your attention to the short term, you can build your savings account and greatly boost your sense of accomplishment.
Whatever you do to keep your savings on track will only benefit you and your investment portfolio in due course.
Whether you have one investment property or plenty of them, Real Property Management Pro Care has a solution fashioned to fit your budget in Quakertown and nearby. Contact us online or call us at 215-770-4312 to learn more about our flexible management services today!
We are pledged to the letter and spirit of U.S. policy for the achievement of equal housing opportunity throughout the Nation. See Equal Housing Opportunity Statement for more information.
