Buying a Rental Property – Keep These Things In Mind
Have you been renting a property you like so much that you want to buy it now?
At David Page Law, we are one of the best corporate law firms Israel can offer. We have some simple advice if you are leaning in that direction.
The process is not as easy as the tv shows make it look. TV makes everything look good. In reality, though, there are a few mistakes you want to avoid.
1)Location and Budget
Location plays a vital role. Will your current rental property offer great equity as the years go by?
Sometimes a rental property is just good enough to rent for a while. Sometimes you have to move onto greener pastures to find what you are looking for. The property might be in the middle of “everything.” You might be able to walk outside your front door and find everything you need. That does not, however, translate to buying.
What about the layout of the place? Will it be everything you need in the long run? Will you spend more on a mortgage than you do on rent? These are things you need to think about. You want a property that cost less to own than it does to rent. Not every rental property goes from a fabulous honeymoon to a happy ending.
2)What About Five Years From Now?
We find that a lot of our clients choose to view the trees instead of the forest. What we mean is they choose to think short-term. They want it now. They are not thinking about five years from now when they could be bored with the property.
We have seen a lot of clients do this. They fall in love too soon. They are more focused on the honeymoon than they are on the marriage. They soon come to find that the marriage is not as easy as they thought.
That is when they decide to sell the place and look for something new. They continue to make the same mistakes without learning the lesson the first time around. That is why we tell you to think long-term.
We have seen some clients dismiss the relationship they need to have with their manager. The client jumps ship as soon as the going gets tough. Managers have a job to do. You need to keep up your end of the bargain, especially if you want to buy the place. Owners get treated differently than renters. You will be playing with a new set of rules.
Renters can be forgiven (somewhat) if they leave in the middle of the night. We have seen it happen. Some renter is behind on the rent. They do not take responsibility, so they bail. They leave everything behind for maintenance to clean. You cannot do that if you own the place. They will take you to court. The laws here in Israel are strict too. Are you prepared to build a long-standing, trustworthy relationship with your landlord?
You will need to renew your leases. Renewing a lease with a mortgage payment is different than renewing when you rent. You could be caught in a blindspot without educating yourself on the system. Legal issues are a lot different when you are on this side of the fence.
You can visit one of our top corporate law firms Israel has to offer at http://davidpagelaw.com/ today.