Location plays an important role in an investment property purchase

Location, location, location. When it comes to real estate, location is extremely important. But it’s not only important when you’re considering a house you’re going to live in yourself. Location is a key factor when purchasing an investment property as well.

If you wouldn’t want to live in a neighborhood, chances are your renters won’t want to, either. You may pay less for a home in a not-so-good neighborhood, but you’ll likely face higher vacancies than if you had picked a home in a more desirable area. Look for a home in a place people want to live.

Know who you’ll be targeting as renters. If you’re targeting families, you’ll want a home that’s near schools, parks and playgrounds. If your prospective renters are college students, you’ll have to be fairly close to their educational institution, as many college students don’t bring their cars to campus and rely on walking and bicycling to get around. If you’re targeting retirees, proximity to health care facilities could be a big plus.

Homes near major employers are often in higher demand among renters. No one enjoys a long commute. Look for investment properties near major employers, shopping and restaurants.