Real estate property is a lucrative investment that can offer sizable returns when managed properly. By investing in rental property, property owners can find stability in a shaky economy, steady returns, tax advantages and appreciation in value.
To get the best possible return on your investment, you need to strategically invest in a rental home in a vibrant market like Knoxville. The team from Keyrenter Knoxville will outline some tips to successfully invest in Knoxville rental property.
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Why Should I Invest in Knoxville, Tennessee?
Knoxville has a mild climate all year round. Even during the winter months, residents of Tennessee only need to wear light jackets. The area’s pleasant weather, coupled with its low cost of living and low taxes attracts residents from all over.
Thanks to the increase in quality and top-paying jobs, Knoxville’s population has been growing. Some of the companies and corporations in the area include Discovery Networks, Brunswick Boats, Regal Cinemas and HT Hackney. Other great employers in the area include Denso Manufacturing, AC Entertainment, Amazon, Thermocop and TVA.
Knoxville also has a number of recreational activities available for outdoor lovers. The area is surrounded by beautiful lakes and breathtaking mountains. A local favorite is the Smoky Mountains National Park which brings in millions of visitors on an annual basis.
With inflation and a rising cost of living, renters are looking for an affordable place to live. Knoxville is a neighborhood with a lower cost of living than surrounding cities. Here, renters can pay less for utilities, healthcare, housing and transportation.
Knoxville, Tennessee has been ranked as one of the most affordable places to live in America and one of the best places to raise a family.
Property investors can also take advantage of the continuous stream of students from the University of Tennessee. The University attracts thousands of students annually with its comprehensive education programs.
You might find success investing in student housing, provided your rental home is in a good location and the property is fitted with the right amenities.
While the area is developing and urbanizing, Knoxville and the larger TN area still have that famous Southern charm and hospitality. Visitors are treated well and new residents find it easy to be part of the local community.
What Do I Need to Consider When Buying Investment Property in Knoxville, TN?
When investing in Knoxville property, there are several factors we suggest you consider.
Location
Renters tend to look at a property’s location first. The location of your rental home will determine the demographic of renters you’ll attract. Ask yourself: what does the surrounding area of my rental home offer? How accessible is it by transportation? How safe is the neighborhood? Is it close to grocery stores or other amenities?
A well-located property can help you gain an advantage over competition. While you might need to pay extra to secure a property in a good location, it will translate to higher rental pricing.
Property Type and Age
In a competitive and diverse area like Knoxville, you’ll find different available housing units. From luxury houses to condos and single-family residences, each has its target demographic and specific pros and cons. Depending on your investment goals and financial capability, think about the ideal property type for your investment in Knoxville real estate.
Consider the age of the property and how its condition might affect the success of your investment. Look for signs of normal and tear and excessive damage. Either of the two might require you to make renovations and repairs to the property before renting it out.
Costs and Expenses
When budgeting for your investment property, consider one-time costs and recurring expenses you’ll incur throughout the lifetime of ownership.
One-time costs come in the form of closing costs, incurred at the time of the sale. Some of the most common types of closing costs include title insurance fees, attorney fees, insurance and home appraisal fees. Depending on the property and your negotiation skills, some of these costs can be passed to the seller.
Recurring costs will be incurred during the management of the property. Recurring costs include property taxes, HOA fees, insurance fees, maintenance and property management fees. We also suggest setting some money aside for variable expenses or in case of emergency. By budgeting well, you can avoid paying for property expenses with your personal funds.
Property Management
Selecting the ideal property is just the first step in property investment. Once you have your investment property, you need to figure out how best to manage it. With smart property management, you can enjoy the full benefits of property investment.
Self-property management is an option many property owners consider, but it can be a daunting task. You’ll need to dedicate lots of time and energy to handling tenant issues, inspecting and maintaining the property.
You’ll also need to make yourself constantly available to tenants, should an emergency happen. Be sure you’re familiar with Tennessee landlord-tenant laws.
For your Knoxville rental property, consider hiring the experienced crew at Keyrenter Knoxville. We have the experience, expertise and local knowledge to guide you on all matters property-related. Our team manages a wide range of properties in the area, from apartment units to multi-rentals.
In a Nutshell: Investing in Knoxville Property
With its vibrant market, low taxes and affordable cost of living, Knoxville attracts retirees, working professionals, students and families alike. Property owners can attest to the high demand for rentals, which translates to steady income, good returns and an appreciation in value.
To become a successful property investor, you need to select a rental home based on its location, property type and age. You also want to factor in any property costs and consider the demands of property management.
Does property investment and management still seem daunting to you? Partner with Keyrenter Knoxville today. You can reach us by dialing (865) 999-4593 or by emailing [email protected].