Here are my tips investing in Bozeman!
1. Do Your Research
Personally, I like units that have 3 bedrooms and 2 bathrooms configurations. This home size will yield a better home for a family or multiple renters to occupy your unit long term and not grow out of the rental property quickly.
2. Secure a solid downpayment
Estimated 20-25% downpayment as the minimum down to secure a loan. (If you have not spoken to a lender, I highly recommend doing so. I can recommend some great local lenders I know provide excellent service.)
3. Choose a low-cost home as your first investment property
Obviously, the lower the purchase price of the home, the higher your profit margins. Each year, you'll want to ensure you have a reserve account to handle repairs (some will be emergency repairs) that will inevitably arise. Low cost does not mean, low quality - be aware of the condition of the home before you purchase and always get a home inspection done.
4. Calculate expenses and profits BEFORE buying
On average, Bozeman rentals (by room are going for $500-$750 + plus per room) outside of downtown Bozeman. A rental downtown Bozeman can potentially yield more per room. For example, a one bedroom apartment will easily rent for $900-$1,100+/month if the rental is downtown (factor in amenities, renovated unit, proximity to Downtown, garage, parking space, etc. to yield this rental income.)
Lastly, factor in your overhead costs for the property including yard maintenance, snow removal, HOA fees, and a Property Manager's fees.
5. Location Matters
Near downtown Bozeman, near park space and playgrounds, on a trail system, near a school - these are all added perks to a rental that will drive up your rental income.
6. Dog friendly home
MANY Bozeman locals / residents own a dog (or dogs) and can yield great difficultly to locate a pet friendly place. Homes with small yards is highly appealing to a tenant with or without a pet.
8. Verify with the HOA
Some Condo Associations may restrict short term rentals. Exercise your due diligence and inquire with your Realtor to do the researching for you!
9. Choose Renters carefully
Be very selective with the renters you put in your home. You will want a renter who you trust and be loyal. Build that relationship up by reaching out, send a thoughtful housewarming gift, etc. The small touches will go far.
Choose a property that will be low maintenance. Of course if you are a handy person, consider what renovations you can do before renting to increase rental value.
If you have interest buying a rental property, please inquire with me directly at Marisa@BuyBozemanHomes.com or call / text at (925) 785-2596.
Posted by Marisa Owen on