What types of homes does everyone typically try to avoid when buying and renting? Homes with only 2 beds? On a main road? No backyard? Are there layouts or other characteristics to avoid that you’ve seen don’t do well?
Homes where you need an armed guard to approach safely. Beyond that, if the price is right, who cares what else is wrong with it.
2 bedrooms? New family with 2 kids will love it, at least until the 3rd kid arrives, but people don't have big families like they used to. Near a college, that's four students.
Main road? It's a little noisy, but get dual pane windows and price it accordingly.
No backyard? Who spends any time in the backyard anymore? Some people don't even want a flower pot.
Layouts? Well that's a real "it depends", and if the layout is bad, you price it accordingly.
Bottom line, for me anyway, the only real deal breaker is if the neighborhood is so bad I'm afraid to visit. Whatever else may be wrong with it, just price it accordingly.
I like two bedroom investments that I can covert to 3 bedrooms. Great upside. Just need enough square footage generally over 1000 square feet. I invest in a lot of BRRRR projects; so poor condition does not deter me provided there is the ability to force equity through, rehabbing kitchen, bathrooms, creating open floor plan, basements generally add a bedroom. Stay away from the following:
Bad layout, unless it can be fixed.
Bad/high crime neighborhoods
Bad school districts
You can fix the property, but you can’t fix the location.
It really depends on the person. I wouldn't buy anything that was a tear down, but others would see that as a huge opportunity. Think about the type of tenant you want to attract and buy a house that would fit them. If you are thinking of a family, professional or retired couple, look for a good neighbourhood. If you want students, buy near a college or university and look for something with lots of bedrooms and more than one bathroom.
Don't buy the fanciest or most expensive house on the street. Get something that needs a bit of a pick me up that can be done with elbow grease and some paint (trim back the landscaping, paint the trim and walls), replace the worn carpet. If it were me looking, I'd try to find a house with a bit of a yard, at least 2 beds and 2 baths. Having said that I have two places that have one bathroom and they've not be a problem to rent as they have other positives.
Think resale later on. This is where location will be important and where you might want to avoid rougher areas.
Above all make sure your numbers work.
@Nick Pawlowski thanks everyone I found a few in a great neighborhood. The backyard goes right down into a creek and I’d like to attract nice families and not sure if that’s a deal breaker with no backyard.
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