If you’ve been sitting on the sidelines long enough, and you want to jump into the potentially lucrative field of rental property, now could be a perfect time to do so. But, before you dive headlong into the process, there are some important tips you need to keep in mind. Otherwise, it could cost you big time, both in the short- and long-term.
First, you need to do your homework. This means really researching the area that you intend to buy in, and gathering key figures, such as the average rent rate, nearby amenities (such as shopping, schools, churches, etc.) that may be appealing to tenants, and market trends – including whether the average rents are going up or down.
It is also absolutely imperative that you know how much money you can anticipate going out, and coming in. For instance, the monthly mortgage payment can often be just the tip of the iceberg for rental real estate owners. So, make sure that you put together an all-encompassing list of potential expenses – and then add some “cushion” to it, just to ensure that you are prepared for a variety of situations.
One of the other essential items on your to-do list before you become a rental real estate investor is to get a good feel for the amount of time that being a landlord can take. This is an area where many investors underestimate – and in turn, are overwhelmed with the long list of duties they are stuck with.
These typically include marketing the property for rent, cleaning and updating the unit between renters, screening potential tenants, collecting rent, performing regular property maintenance, and responding to tenant emergencies.
If you don’t want to become a 24 / 7 property maintenance and tenant management service, but you still want to reap the rewards of owning rental property, there is a solution. By hiring an experienced property manager, you can take yourself out of the day-to-day operation, and still partake in the benefits.
Want more information? Just give us a call and we’ll be happy to answer any questions that you have.