Welcome to the first part of a two-part series for investment in commercial property.

After driving on the windows and downs of the market composition return for a certain time, a growing number of investors willing to invest in real estate as an alternative stable. In hot markets in many parts of the USA, the time be ripe May, in this potentially lucrative market. I would say, however, that you can read before they go home first. Just find something in this article, you continue to break the bank and back.

I wish all investors is to build long-term wealth, it is very clear principle and probably also the reason to read this article. However, there are a number of rules to play with investments in the property game, unless you want to strike a blow to take with them when rent should be collected. I am talking about how to prevent a “slumlord”.

To apply the highest standards for an owner of success, let me share a story experienced by some members of the extended family. It is an excellent example of how not to do if you want to make the most of your investment. After the story, we’ll see what the rules and lessons we can learn. The names are changed to protect the identity of innocent people.

Ben bought a drummer family investments in real estate in a very bad and his two son, Josh and Nathan, received all employees. They have wooden floors-answer nobody wants to replace the carpet whenever you, right? And then they really felt good use of paint-nobody wants to answer back every time, n’est-ce pas? And when he decided to jump into a bathroom and closets fixed happy tenant is a good driver, right? And closing the summit, due to Nice towels to cool on racks that said: “We are family.” Tenants appreciate that, right?

Right.
The first family to move in and out of a private room doors of firewood, fertilizer Nice bathroom and accessories sold at Swap Meet, to choose and small arms through the cycles of new plans. Ben discovered when he received a call that is the roof and must go, “Take your *** here and solve the problem!” He patiently tried to explain that the roofs where to download images of inflammation. Other visits wonderful, inspired by a similar call.

It is only eight months, until they are out of the house; It appears that the tenant rights, as specified by the district court to enumerate more rights than the rest of us collectively. Since the family moved to see that he and the mother of two boys more focused all the shirts stitched with the “We Are Family.” They have other parts of the house.

Ben, Josh and Nathan began to build a house, find all kinds of interesting changes in its structure. Nothing serious, other than to support the package was chain sawed down (apparently more firewood), bathroom tiles pried a clear reason why not, the group has signed removed all windows and mirrors, which were demolished and other small surprises.

Although some contributions restring wire scan later in the locker room hangers-Josh nanizani rusty found a .32 caliber handgun. One or other tenants were able PRY baking bricks that Ben must be replaced to comply with the code. Apparently, someone drove a M1A1 Abrams of the aisle, had no other way to explain a huge cracks in the street, always good for 20 years.

What can we learn from these terrible, but unfortunately life?

Rule No. 1

Location, location, location. OK, this May seem a little “cliché, but the fact that the location of investments in real estate, determine the nature of tenants that will attract and how much rent you can pay. Do not forget that, any given point of time in the future, it is necessary May for you and your family to participate; near what you want?

Rule No. 2

Not when you go behind the definition of investment in real estate. You should expect reasonable wear and tear. It is noted that “reasonable wear” is something completely different person whose rent than the owner. And forget that the great goodness, “We Are Family” towels!

Rule No. 3

Knowing how to make repairs. Fortunately for Ben and children, who have little experience in various construction jobs. Otherwise, May they have lost money, even more than hiring help. Knowing how the electrical problem, sewage repair and replacement windows will save you a lot of money for the road.

Rule No. 4

Inquilini your screen while moving to live with it. This is perhaps the most important step to avoid a slumlord. Questions and check references. Call former owners and ask questions like: “Did they pay the rent on time? How is the condition of the house / apartment at the time of his departure? That Lee never disturb the neighbors with a music or shouting matches How many times do you need special tours premature for repairs? “To be informed as possible, which can be rented will be a big difference in terms of return on investment.

Rule No. 5

Know your rights as a landlord. Familiarity with the expulsion order to avoid long, drawn up in disputes with tenants. Most Member States and provides online information for the landlord and tenant rights.

Not commit the same mistakes committed by Ben and his children. Of course, obtaining investments in commercial real estate is difficult and that work will do things that normally would not be bound art At the same time, steps you can take to limit its liability for the prevent “slumlord”.

In the next part two of this article will explore some aspects of financial awareness in order to find the best deal possible on your initial investment in real estate.