There are many ways to increase one’s wealth. And one of the best methods consists of buying an investment property to rent. When you do this, you’ll own a home that will increase in value over time while also collecting rent that acts as passive income.
There are very successful and wealthy people who have built fortunes by doing this. In fact, there are more than twenty million rental properties in the US. Of course, there are also people who have faced financial ruin because they were not careful in how they invested.
Luckily for you, we’re here to help. If you would like to know what to consider when buying an investment property for rent, then keep on reading and we will take you through everything that you will want to know!
Decide If You’re Cut Out to Be a Landlord
Being a landlord isn’t easy and can be stressful and overwhelming. As a landlord, you’ll have to find the right property, prepare the building, and find good tenants. Not to mention taking care of maintenance and repairs.
If you’re a handy person, you might be able to take care of problems on your own. However, this can take up a lot of time and you can run into complications. You can hire professionals or even hire a property manager to deal with problems but those solutions are going to cost you a good amount of money.
As you accumulate more properties, you will become more experienced and be able to outsource more and more jobs.
Find the Right Location
While it’s a cliche at this point, it is still very true. When it comes to real estate, it’s all about location.
You want to find a location in an area that is growing, not declining. Otherwise, you’ll have to deal with depreciating property values and undesirable tenants. This can end up costing you more money than you’ll be taking in.
Look for an area that has a good school district and low property taxes. You’ll also want the area to have a lot of amenities, these can include parks, trails, shops, cafes, and restaurants.
You’ll also want to look for locations that have access to public transportation, a low crime rate, and a growing job market.
Decide What Kind of Property You Want to Own
As a new landlord, you’ll have to decide what kind of property you want to own. A single family investment is a great way to start because you’ll deal with only one unit and a few tenants.
Some new landlords like to get a duplex and live in one unit while having tenants in the other unit.
Use These Tips When Buying an Investment Property to Rent
Hopefully, after reading the above article, you now know several tips for buying an investment property to rent. As we can see, you can build wealth and collect income through these kinds of investments but you need to do it smartly.
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