Investing in real estate is an endeavor that’s as exciting as it is potentially rewarding, especially when considering dynamic, growing markets like Dayton, Ohio. Navigating the real estate landscape requires a thorough understanding of the buying process. This is a multifaceted journey, broken down into four major stages: the pre-purchase phase, the property search and evaluation, the actual purchase, and post-purchase management.
Each stage is critical in shaping your investment outcome in the Dayton market and has its own timeline. While these timelines can differ based on various factors, we’ll provide an approximate duration for each to help you plan better.
Pre-purchase Phase
The initial phase in your real estate investment journey is largely about preparation and planning.
Market Research
A sound understanding of the Dayton real estate market is crucial to purchase a quality property. Spend one to two weeks studying the Dayton rental market, learning about emerging neighborhoods, price trends, and factors affecting rental yields. Tools for this research include online real estate databases, local real estate publications, and data reports from real estate consultancies.
Financial Planning
Following your research, take a detailed look at your financial readiness. This includes setting a budget, reviewing your savings, and getting pre-approval for loans, which may take two to four weeks. Don’t forget to consider your credit score, which significantly impacts your ability to secure advantageous loan terms.
Selecting a Real Estate Agent
A knowledgeable real estate agent can offer valuable assistance, providing insights specific to the local market, aiding in property selection, and smoothing out the purchasing process. Choose an agent with a strong local network and a proven track record in investment properties. You may have to spend one to two weeks interviewing potential agents and choosing a professional with expertise in the Dayton property market.
Property Search and Evaluation Stage
Once prepared, you’ll move into the active phase of seeking out and assessing potential properties.
Property Viewings
Use your research and agent’s knowledge to generate a short list of promising properties. Schedule viewings over the next two to four weeks to examine each property’s condition, its location advantages, proximity to amenities, and its potential to generate rental income or appreciate in value.
Be wary of any properties that are priced way below market as they most likely are too good to be true or worth it. (Read our previous blog: Local Dayton Rental Property Deals And Steals: Are They Really Worth It?)
Professional Inspections
If a property aligns with your goals, commission a professional inspection to identify any hidden issues, structural problems, or required renovations. This evaluation can influence both your decision to proceed and the property’s final negotiated price and can take one to two weeks to schedule and complete.
Negotiations
Armed with the inspection results and an understanding of the property’s market value, you’ll negotiate the purchase terms. Your agent will be instrumental here, advocating for your interests and striving to secure a fair and beneficial deal. This back-and-forth can take another one to two weeks.
Purchase Phase
The second to last stage involves finalizing the purchase and locking in your financing.
Making an Offer
If negotiations are successful, you’ll formalize your interest by making a written offer. The seller will typically respond within a week. Once accepted by the seller, a contractual agreement is formed, typically subject to contingencies like a successful final inspection and confirmed financing.
Closing the Deal
The closing process involves several steps including finalizing your loan details with the lender, conducting a title search to ensure the property has no legal issues, securing landlord (or homeowner’s) insurance, and signing all the necessary paperwork to transfer ownership, which usually takes about 30-45 days.
Finalizing Financing
By this point, your financing should be lined up, ready to be finalized. The financing process typically runs concurrently with the closing process, as your lender will be working to finalize your mortgage in time for closing. If you’re leveraging a mortgage, you’ll coordinate with your lender to wrap up the mortgage process, ready to be disbursed at closing.
Post-purchase Phase
Once the property is yours, the final phase is all about preparation for your return on investment.
Renovations and Repairs
If your property requires any renovations or repairs, now’s the time to get these done. This could range from minor aesthetic tweaks to significant overhauls, all aimed at optimizing the property for rental or resale, and can take anywhere from a month to two months, depending on the extent of the work needed.
Preparation for Renting
If your strategy is to rent out the property, decide on the rental price, list the property on rental platforms, and begin the tenant screening process. Prepare lease agreements and understand your obligations as a landlord. This entire process should take no more than two to four weeks.
Property Management in Dayton, OH
Effective property management is crucial for maintaining the condition of your property and ensuring steady rental income. You can choose to manage the property yourself or hire a professional Dayton property management company, depending on your resources and willingness to be involved in day-to-day management.
However, property management is an ongoing responsibility, involving regular maintenance, handling tenant issues, and ensuring a steady return on your investment.
In total, the entire process from the pre-purchase stage to having a rented property can take approximately four to six months. Having said that, please note that these timelines are estimates and can vary depending on specific circumstances, market conditions, and the specifics of the property.
Enlist the Help of a Property Management Company
The real estate investment journey is complex and filled with nuances in each phase that can dramatically impact the success of your investment. Partnering with a local real estate professional can make all the difference.
By leveraging their expertise, you can expedite the property buying process, increase your chances of finding high-quality investment properties, and ensure the process is smooth and efficient.
Arguably, the best way to find a good investment property in Dayton is by working with an experienced property management company. Local, professional property managers offer a comprehensive suite of services, covering everything from property search to closing, renovations, tenant management, and more.
ManCo Property Services provides excellent property management services throughout the Dayton area. We can help you navigate the intricacies of the property market with confidence and provide the local expertise and guidance you need to make informed decisions at every step of your property investment journey.
Connect with us to take that first step toward securing your ideal investment property.
