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Factors To Consider in Real Estate Investment One can never miss a way of generating income through investments. Investments to the projects an individual pursues with the aim of getting more than they put in. There are several types of investment each of which has its maturation rate and the amount of profit it garners thus one can choose the investment they would like to make based on these two factors. Among the many types of investment that exists, Triple Net Investment (NNN Investment) is one of them. It is a kind of real estate investment where the owner leases out their property to a tenant that has a good credit record for a relatively long time of around 12 to 25 years. Anyone who has made a wrong investment knows the loss that you are sure to incur. Therefore, it ‘s nice to bring a few factors into consideration to ensure you do not incur losses. These factors include assessing the location of the property, evaluating the credit worthiness of a potential client, the clarity of the contract and even the nature of the lease. It is the fact that the site of property especially in real estate is critical in making investment decisions. Location the evaluation aims to find a property in a zone that will be lucrative. Signs that show the land is bound to appreciate or is marketable already is infrastructural development in the area like electricity, roads, and water. To get real returns in a lease and avoid renovation costs, it is important to get a property that is in good condition.
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It is also critical to assess the credit record of a potential tenant to check whether they are fit to lease the building. You will avoid conflict in lease payment when you get a customer with a clean credit record. An unreliable client will cause you to spend the lease duration in legal tussles that cost money.
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The contract also ought to be clear to both you and the tenant, so this is where a lawyer comes in. An attorney will help put legal language into layman’s terms and make sure there are no loopholes that a tenant can exploit in future. It is also important to state clearly factors that may lead to contract termination and what the reimbursement strategy is if at all there is any. Last but not least,it would be vital to know the type of lease you would like to offer. The leases available include bond lease, modified net lease triple net lease and even gross lease and each has unique traits. You can hardly go wrong in your triple net investments using these tips very carefully.