Buying an investment property to rent is a great way to make passive income! With the real estate industry thriving and interest rates set at an all-time low, there has never been a better time than now to invest in properties to rent! There are plenty of people not ready for the longterm commitment of buying their own home and rely on leasers for their new home!
Rent to Students
The audience is one of the most important factors in investing and leasing properties. While most people may be afraid to rent to students due to their age and reputation, students are one of the best audience and groups to rent to! College and University towns tend to be more expensive. While they are more expensive to buy properties, the rate and rent each month should be enough to pass a gradual income.
Short-Term Renting
Airbnb has grown tremendously in the last couple of years. This renting platform is great for short-term renting that may be doe people who want one night, to a whole week. This platform is wonderful for property investors looking to rent and make passive income. The only requirements are to keep the place in shape as much as possible. When guests leave, clean sheets and toiletries are required before the new guests come to use the property. These small changes and cleaning make renting out for short term great!
Long-Term Renting
Although the term ‘long-term renting’ may sound straight forward, there are lots of aspects to long-term renting. When you purchase real estate to rent or lease out, it is a good thing to come up with a minimum contract date. Some owners prefer having a minimum rent of one year before renewing or breaking a contract. This allows for steadier income. Other owners prefer not having a contract to allow for changes easily. Source: fitsmallbusiness
Housing Market News – Investment Property To Rent is A Good Choice?
Buying an investment property before your first home will pay off if done correctly. By renting out a house you have purchased, you leverage your credit, limited responsibilities, and your lifestyle into an investment. All you need is a little bit of real estate insight. Buying an investment property before your first home might be a good idea because of the following reasons:
1. Affordability: Even though everyone may have a dream area they would like to live in, not every place you may want to live in will always be affordable. Maybe you want a place where you will commute for a just a few minutes or want a place with a vibrant cafe and restaurant scene. Regardless of your preferences, if the place you like is too expensive and you can live in another place, then you can continue to rent while possessing an investment property.
2. Lifestyle Flexibility: Buying an investment property before your first home and renting instead will give you the opportunity to reside in any location you choose to. It may be a location that is too expensive for you to buy a home. You will be flexible since you won’t be tied down to a specific area. For instance, when your life or career dictates that you relocate to a new area, city, or country, you can do so easily without worrying about what to do with your home. Buying an investment property before your first home will give you the freedom to change address when you need to while also offering future stability and growth.
3. Partnership with a Family Member or Friend: In instances where you lack enough cash for a down payment of your dream rental property, you could decide to partner with a family member or a friend and buy the investment property together. Even though they may not be willing to help you purchase your first home to reside in, they may consider investing together.
4. Cash Flow: If you do the right selection of investment property (fairly low priced and with a high amount of rent) and select the right tenants, you can start gaining positive cash flow straightaway and use it to improve your life. In this case, the tenant pays off your purchase and possibly leaves you with some extra funds. After allocating the down payment from your savings, future costs such as maintenance, insurance, mortgage, and property tax should get covered by the rent from the property that is paid by the tenants. You can find all the reasons to invest a house for rent on mashvisor.
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