Getting started in rental real estate is not a decision you can make overnight or at the spur of any moment. You must indulge in meticulous consideration, assess the various pros and cons, understand your strengths and weaknesses, explore the opportunities and then make an informed decision. Rental real estate can be a rewarding investment and it can be equally painstaking if you are not ready and well equipped. Before getting started, we recommend speaking to your YNM Realtor for sound advice. Here are some tips that will shed some light on how you should start investing in rental real estate.
- Be well aware of your finances. Assess all your assets, factor in your expenses and total income from all sources. You must be financially sound, have little or no debts, you should have a steady income and you should be able to dedicate some time to the real estate venture. You don’t need to be a mogul in any industry to invest in rental real estate but you cannot be under unmanageable debt nor have unpredictable and unstable income either.
- You should invest as much as you can. If you cannot organise the funds necessary to make the down payment, if you don’t qualify for the necessary mortgage, if the mortgage is too high or the profit you would churn would not be sufficient to keep the rental real estate venture going, then you should think of some other investment.
- Have a well-defined plan and for that you would need very lucid goals. Where do you wish to see yourself in five years and ten years, how much you want to churn out from your investment in rental real estate, how you would use the property, what kind of investments you would consider in the near and distant future and several such short as well as long term goals will have to be figured out as you plan to invest in rental properties.
- You must assess the risks of investing in rental property, just as you would consider the wonderful benefits. You would need to rely on a few professionals unless you have the skills in you. From tax experts to real estate attorneys, real estate agents to property managers, you will need people who have the expertise and would dedicate their time, staff and other resources to run the venture for you.
Limit your risks by having a co-buyer or a partner. That way you can leverage more funds and individual exposure to risks would be much more manageable.
And once you have your investment properties - make your life easier by getting a property manager to handle your rental properties for you! - YNM provides professional and expert property management services, call us today.