Keyword(s): property investing
36.6% of households in the US rent their home or property. This is the highest percentage of renters since 1965.
Are you interested in buying an investment property? Now might be the right time. Owning a rental property can get you a long-term return on investment, but you need to understand how it works before diving in.
This article wants to help you understand what you should know before you start with property investing.
What Is Real Estate Investing?
Real estate investing is when you purchase real estate or property intending to resell it or use it as a rental property. Many investors look at buying real estate as a way of diversifying their investments.
Purchasing Real Estate
For your first-time purchase of a real estate investment property, there are a few things you should keep in mind.
Before you start, you need to be honest with yourself and understand your financial situation. Ensure you have enough money for a downpayment and to cover any issues that may arise. Make sure you have a good credit score so you can get the best loan rates.
It's a good idea to draft a business plan for your investment property. This can help you understand your property goals and help you evaluate all of the costs associated with the investment.
Understand that the costs of purchasing property go beyond the actual purchase of the home. You may need to renovate. There will be property taxes and other expenses that you may not have thought about.
Understand Your Risk
Any investment comes with risk. To protect yourself, you should consider putting your investment property under the name of a legal entity instead of your name. Before purchasing, speak with a lawyer to ensure you're protected.
If you are renting your property out, dealing with tenants can also take up a lot of your time. You may also experience times when your house is vacant. Consider hiring a property management team that can help with any issues you may have.
Benefits of Property Investing
Property investing gives you a physical asset that will grow in worth over time. If you own a rental property, not only can you make a passive income, but if you look after the home, the property investment itself will grow over time too.
There is a certain amount of flexibility you have with investment properties. You get to choose your tenants, how much you rent your property out for when you renovate, and when you want to sell.
Purchasing real estate as an investment also tends to be less volatile than the stock market. You will likely see long-term stable growth on an investment like this.
Ready to Dive Into the World of Property Investing?
Property investing can be a great way to diversify your portfolio and get you a stable, passive income.
If you are a first-time buyer with a property you want to be managed or are planning to invest in one, contact us today! We can enhance and maintain your rental property. We'll look after it like it's our own.