Investment property is real estate that is purchased for the purpose of gaining some sort of monetary profit from it in the long run. This is contrasted with other types of property, such as residential property, which the owner typically resides in on a day-to-day basis. The owner of investment property typically doesn’t live on the premises of the investment property.
Instead, they often take certain actions to make the property profitable, such as:
- Renting the property out to another person or family
- Converting the property for specific usage (such as a small business)
- Making additions or home improvements (such as adding a story or adding a garden)
- Restoring or renovating old property ("fixer-uppers")
- Selling the property at a later date
Of course, most property owners would like to make profit on their residential home as well if they sell it in the future. However, investment property is often purchased with the specific intent of taking actions similar to those mentioned above.
What Are Some Common Examples of Investment Property?
Some common examples of investment property include:
- Second homes
- Homes purchased with the intent of renting out the rooms
- Vacation homes
- "Destination" homes (i.e. homes located near local attractions)
In some cases, a person might invest in business or commercial property. However, these are often categorized differently than residential property, as they often involve different laws and may operate on a larger scale.
What If I have a Legal Issue with Some Investment Property?
Investment property is often associated with different legal issues than normal residential property. For instance, cabins and vacation homes may have slightly different specifications when it comes to mortgages, zoning, and other issues. Also, investment property is often subject to disputes over rent, and they are also subject to quick resale after market. Some types of investment property disputes may require a legal filing with the court to fully resolve. These can result in a damages award, for instance if there has been a breach of contract.
Do I Need a Lawyer for Help with Investment Property?
Investment properties can help a person achieve financial stability over the long run. They can however be associated with various legal issues and considerations. You may need to hire a real estate lawyer in your area if you need assistance purchasing, maintaining, or selling an investment property. Your attorney can inform you of your legal rights and can explain how the laws in your state work. Also, if you need to file a lawsuit or attend a court meeting, your lawyer can provide you with representation in court.