Buying a Rental Property
Buying a rental property can be a significant investment, as it establishes an income stream separate from the primary source of income. This is a good option for those who don’t have the funds to buy a primary residence and still want to purchase real estate. Many people who own rental property appreciate the steady income it represents after they retire. With a rental property, they can rent out a vacant property, earn some money, and make a monthly profit. Rental properties benefit investors because they provide consistent income and, in some cases, a tax deduction. Here are a few tips that may help people to find a rental property.
Finding the right location for a rental property; in hot or on the rise areas is a suitable investment. According to Dr. Jordan Sudberg, “Vacancy rates tend to be lower in areas where we’re seeing substantial population and employment growth.” Therefore, properties in these places are less likely to sit vacant for long periods, which can reduce the amount of money lost on rent. It also pays to look for locations with a high percentage of single-family homes, as these housing options generally return the highest profit. These are ideal properties since they tend not to be occupied by other renters, so it is easier to get the money back when the property becomes vacant.
2. The Price Range
Different neighborhoods have varying price ranges, so it is essential to understand this before purchasing. According to Dr.Sudberg, “Properties in some areas with desirable amenities or great views may be priced higher than the average for the area.” These high-end properties usually see a higher occupancy rate, so paying the extra price for a better location is worth it. Start researching rental properties in your area and find out what strategies have been successful for other investors. For example, look at the property’s price per square foot and ensure it is reasonable. Some property investors will consider a lower-priced house in exchange for a larger one with a garage.
3. The Number of Bedrooms
Investors have found that multifamily houses with more than three bedrooms tend to return the highest profit. These houses offer more opportunities for renting out the property to more people. The more people pay for the house, the larger the return on investment. Many investors prefer homes with three or four bedrooms – as these tend to attract a more significant number of renters. They also rent more often, so there is less of a chance that the house will sit empty for extended periods.
Dr. Jordan Sudberg believes that buying a rental property is an excellent way to generate income after retirement. This is especially true when the property doubles as a primary residence that people can use during winter. In this way, investors can enjoy the property for their personal use and make some money from it in the summer. Rental property is an excellent way to create a steady stream of income and make money every month