Real estate is one of the most popular investment categories. When done properly, real estate investments offer the investor excellent profits. It’s a highly common investment choice due to its safety and possibility for future growth. 

However, research prior to investing in out-of-state or local real estate is important because it involves a significant sum of money, and one wrong move could cost the investor a lot. To thrive in this industry, one must adapt to the challenges, disruptions, and risks that come with it.

Investors must consider certain factors before making a real estate investment if they want to maximize their returns. Below are factors that we at Keyrenter Property Management New England have compiled for real estate investors to consider before investing in real estate:

The Type of Property

One important aspect to consider when investing in real estate is the kind of property you choose. Different property types have various potentials for growth, costs, and demands. Selecting a property type that matches your investment objectives and risk tolerance is crucial.

Consider the following types of investment property types:

Residential Real Estate

Residential real estate, including single-family homes, apartments, and townhomes, is in great demand, particularly in places with expanding populations and robust job markets. 

Residential properties offer a consistent income stream through rental payments and the potential for long-term gain. Unlike commercial buildings, residential homes often have more minor upfront expenses and lesser risk.

person passing house keys to someone else in front of a red sold sign

Commercial Properties 

Compared to residential assets, commercial properties, such as office buildings, retail space, and industrial properties, can offer larger profits. Commercial real estate, however, often carries a higher risk and upfront expenditures. 

Commercial properties may also experience longer vacancy times and be more vulnerable to economic ups and downs. It’s crucial to have a thorough awareness of the local market and the long-term growth possibilities when investing in commercial properties.


Knowing your spending limit is important before you consider buying a property. The type of property you can afford, the location, and the possibility of a profit will all depend on the amount of money you have to invest. Keep the following things in mind when you create your real estate investing budget:

  • Down Payment: Your initial investment when buying a home is the down payment. A greater down payment can lower your monthly mortgage payments and raise your home equity.
  • Closing Expenses: Closing costs include the fees involved in buying a property, such as a title insurance, appraisal fees, and legal fees. When creating your budget, you should account for these expenses because they can quickly add up.
  • Ongoing Expenses: Owning a property entails additional recurring costs including property taxes, insurance, upkeep, and repairs. To ensure you have enough money to cover these expenses on a continuing basis, you need to account for them in your budget.
  • Emergency Fund: It’s crucial to set aside money for unforeseen costs, such as significant repairs or vacancies. This amount should be sizable enough to cover expenses for several months.

aerial shot of a neighboured with green lawns and lush trees


One of the most important variables in assessing a property’s value and growth potential is its location. Properties are often more in demand and cost more when located in desirable neighborhoods with good schools, low crime rates, and robust employment markets. When deciding where to find your rental, you should consider your potential customers. 

For example, choosing a well-established city can draw in more tenants as there are more opportunities for jobs and entertainment. It’s crucial to investigate the local market and consider the area’s long-term growth and stability when choosing a location.

Market Conditions

Another important aspect to consider when investing in real estate is the state of the real estate market. A healthy market with low lending rates and significant demand can offer fantastic profit opportunities. On the other hand, a weak market can provide difficulties, given the diminishing demand and rising interest rates. 

Remain informed of current market circumstances and developments to modify your investment plan as necessary. Interest rates are another important factor that impacts market conditions. Low-interest rates can lower borrowing costs, increasing housing demand and raising property values. 

When analyzing market conditions, demographic developments should also be taken into consideration. Population growth, migration trends, and aging demographics are just a few variables that may impact housing demand and property values.

person holding a red pen looking over papers with graphs and pie charts

Financing Options

When investing in real estate, it’s essential to take your financing alternatives into account. Varying forms of funding such as conventional mortgages, hard money loans, or cash purchases have different terms, conditions, and expenses attached to them. It’s critical to comprehend the benefits and drawbacks of each choice and pick the one that best suits your financial condition and investment objectives.

Tax Implications

Another crucial aspect to consider when investing in real estate is the tax consequences. In addition to producing taxable revenue, properties can offer tax benefits, including mortgage interest and depreciation deductions. To optimize your returns and reduce your tax liability, it’s critical to understand the tax ramifications of real estate investing and to consult with a skilled tax practitioner.


Real estate investing can be a successful and rewarding venture, but before making any decisions, it’s crucial to consider that the success of your investment can be impacted by several aspects, including knowing the local market conditions, examining the property’s finances, and taking into account the location and type of property.

We at Keyrenter Property Management New England recognize the significance of these elements and are prepared to offer professional advice and support to assist you in making wise investment choices. Our team of skilled experts can offer insightful information on the financial performance of properties because they are familiar with the specific market circumstances in the area. 

Contact us today to learn about our New England property management services!