If you are planning on investing in rental properties in Calgary, it’s important to have a well-informed approach involving market research, selecting the right location, and planning for contingencies.
Research the local market.
If you’re planning on investing in rental properties in Calgary, conducting thorough research on the local real estate market is essential; this involves gaining an understanding of various factors such as property values, rental rates, and demand for rental units in different neighbourhoods. It’s crucial to keep a close eye on market trends, such as whether property values are appreciating or depreciating in specific areas, as this can significantly affect the long-term growth potential of your investment. Additionally, consider economic factors, population growth and employment options in the region, as these variables can influence both the rental market’s stability and the types of tenants you might attract. By conducting comprehensive market research, you can identify areas with the best investment potential, minimize risks, and tailor your investment strategy accordingly.
Select the right location.
When selecting a location for your rental property, it’s crucial to consider your target tenant. This requires a thorough analysis of various factors, beginning with the neighbourhood. Suppose you plan to invest in a rental property that will be rented out to a university student. In that case, you’ll likely want to choose a property located around the University of Alberta or MacEwan University, or near an LRT station that goes to one of the post-secondary institutions in the city. On the other hand, if you plan to rent your property to a family, you may want to look in the suburbs, where there are schools, parks, trails, green spaces, and family-friendly amenities nearby. By selecting a location for your Calgary real estate investment with these considerations in mind, you increase the likelihood of attracting and retaining reliable, long-term tenants, which is necessary to maintain a consistent and profitable rental income.
Plan for contingencies.
Investing in rental properties in Calgary can be risky, and you may encounter unforeseen expenses. Therefore, being financially prepared to handle any unexpected costs is essential. These contingencies can include sudden repairs, maintenance costs, tenant turnover, or economic downturns that affect the rental market. One way to be financially prepared is to build a reserve fund. A reserve fund is a financial cushion that acts as a safety net, giving you peace of mind and allowing you to handle issues that come up unexpectedly so they don’t escalate into more significant problems. A typical rule of thumb is to set aside a percentage of your rental income into a reserve fund. Ultimately, having a reserve fund helps protect your investment and assures you can continue earning positive cash flow even when faced with unforeseen challenges.
Working with Realty Unleashed
Realty Unleashed is an independent real estate brokerage serving Edmonton and Calgary. Our team of REALTORS® are committed to satisfying our clients and ensuring that we help you every single step of the way. If you are considering investing in rental properties in Calgary, we can help you find what you want. Please fill out the form below, and someone from our team will get back to you!
