When the chance to purchase Richland investment property arises, one of the critical things to consider is whether to purchase a property in an established neighborhood or a home in a common interest community. There are many different kinds of neighborhoods, some with owner’s associations (commonly known as HOAs), others without. Yet, a master-planned community is completely different from your usual residential neighborhood, even those that may have an owners association.
To decide if investing in a planned community is right for you, you must first understand what makes a master-planned community so different, as well as the pros and cons of buying one.
The Master-Planned Community
Probably the most important thing to know about master-planned communities is that they are less like residential neighborhoods or suburbs and more like little self-contained cities. Most planned communities are greater in size and include commercial districts, schools, and private recreational amenities. Many planned communities have a selection of shops and restaurants and strolling trails, municipal pools, and even golf courses – all located at a convenient distance from the community’s residences.
Advantages of Planned Communities
One of the major advantages of investing in a rental property in a planned community is the location. Individuals purchase in planned communities in large part due to how close and accessible everything is. Walking or biking to jobs, shopping centers, and restaurants can be a compelling attraction.
The amenities that most planned communities offer are another useful feature. Numerous tenants want the idea of living a lifestyle that includes access to recreational opportunities – principally if the amenities are only for the use of the residents. These amenities may give possibilities for socializing than an average neighborhood.
Another huge benefit of a planned community that investors might like is that most are geared toward protecting your property values. In many planned communities, the common areas are well-maintained, and some even include front yard maintenance for residences. This can help keep your property values high, even if the rental market isn’t doing well elsewhere. Planned communities also tend to offer more security, including gates and security patrols. This can be very appealing for many tenants.
In reverse, all that upkeep and security comes with very strict rules, which some Richland property managers and tenants may agree with. Property maintenance will be a much higher priority in a planned community than in a more typical residential neighborhood, and you will have lesser rights to choose landscaping styles, paint colors, and even if and how to decorate the home for holidays. You and your renters may need to get permission before engaging in any of these activities.
Another potential drawback is that there tends to be less privacy in a planned community. Houses are often built very close together, which can strain relations with neighbors. There is also a high rate of people doing activities outdoors, so crowding is always a possibility. Some tenants may dislike being around people all the time.
Finally, the downside to all the extra upkeep and great amenities you get in a planned community is that it all costs money. Depending on the community, property owners may be expected to pay extra fees that range from several hundred to thousands of dollars each year. Depending on the property you purchase, you may even have an obligation to pay assessments to two or more sub-associations along with the master association. These assessments may also change as the community grows, maintenance becomes more expensive, or as reserve amounts are needed. As an investor, you need to include these extra fees into your calculations before you buy in a planned community.
Lastly, the ultimate decision to purchase in a master-planned community is yours. Because no two instances are alike, where you want to buy an investment property and what type of tenant you’d prefer to work with may factor strongly into your decision.
If you need assistance planning your next property investment, consider giving Real Property Management Tri-Cities a call. Our rental market experts can deliver market assessments and tools that can make finding and choosing your next investment property easier. You can contact us online or call 509-572-5440.
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