Many investors call each day asking what to look for in a rental home. In my experience I share with them 3 things that will help them make the decision as to whether or not they will purchase a particular home to rent out.

1-    Location- Everyone knows that location determines everything when it comes to purchase price. Location also dictates the rental price of a home as well as the future value of the home. Location is also important in leased homes because it can impact the number of times the property turns over (changes tenants). Investors will agree that one of the biggest costs in property management is when new tenants move in after old tenants have moved out.

2-    Condition of the home- A dirty home will not rent out as quickly (typically) as a clean home. Although this is common sense, one should make sure they factor in costs to clean a property if it is not already in this condition upon purchase. Remember, this includes not only cleaning up the trash, but also making sure every component of the home is functioning properly (i.e. doors, windows, blinds, appliances where applicable etc.). Make sure you know the costs associated to handle this. Where possible factor in costs for appliances, or possibly other requests that may increase a properties ability to rent out more quickly.

3-    Market value of the property- It is important to take into account the market rental value of the property being leased. I recommend being conservative when making this estimate. One swing the market values could have your home being rented out $100 less than planned for, or create a situation where the home sits vacant for over 30 days.

Considering these key points will help any investor in their decision making regarding residential rental properties.