What does a buyer need to assess when purchasing investment property?

When purchasing investment property, it is crucial for a buyer to assess potential rental income and property value appreciation. This evaluation allows the buyer to determine the investment's viability and potential return on investment. The expected rental income indicates the cash flow the property can generate, which is essential for covering expenses such as mortgage payments, property taxes, and maintenance costs. Additionally, property value appreciation speaks to the long-term growth potential of the investment, as real estate generally increases in value over time. A thorough analysis of these factors helps the buyer make informed decisions and set appropriate investment goals, ensuring that the property aligns with their financial objectives.

Considering the other options, while renovation costs may be relevant for personal use renovations, they do not impact the investment potential as directly as rental income and appreciation. The historic performance of the seller's finances is more pertinent to the seller's ability to maintain the property rather than an assessment of the investment itself. Lastly, the reputation of the previous owner could provide some insight into the property's management, but it does not directly influence the investment's current or future performance in the market.