Investment in rental property can be a viable financial investment creating long-term savings and financial freedom.
Buying rental properties with the aim of renting them out to generate an income is definitely not a "get- rich-quick" scheme.
In fact, you will probably need to spend some money and exercise a great deal of patience before you will see a return on your investment.
You need to look at this as a long-term investment options (don't be tempted to sell your properties to make a quick profit).
Hold onto to your properties and eventually your financing of investment properties will see your tenants generating an income for you (sustained cash flow that can combat inflation.)
INVESTMENT PROPERTY FOR SALE - INVESTMENT IN RENTAL PROPERTY
First and foremost - research and do your homework.
Buy a property in a good area where the residents have good jobs. (smaller properties have less maintenance and tend to be more easily let - think apartments or duplexes)
(You want to maximize your chances of finding good tenants who pay their monthly rent because they have a good job to support their lifestyles and because you are investing in a sought after area)
Finance the purchase price and other additional costs by sourcing the best loan and interest rate deal from a trustworthy financial institution.
Find good tenants who will rent out your investment property ( a rental agency can make your life a lot easier here - but it is also very manageable to do-it-yourself)
SIDEBAR: - it is always a good idea to be a hands-on investor (after all - it is your money - so keep your eye on it)
Be aware, that initially, it is unlikely that your tenant's rent will cover all the costs incurred on your investment (this is where you need to spend money - sort of a forced savings plan - in order to generate long-term cash flow for years to come)
Eventually - over the years (yes...years - so be prepared and be patient) you will pay less and less out of your pocket.
The rent that you receive from your tenants will start to cover your costs (you break even) and then - you start making money.
Your investment property in paid off and now you earn money from your tenants - cash flow and a certain percentage of capital gains growth.
A passive income is a great reward for your initially forced savings and well worth the potential financial freedom that you will stand to gain.
Can you afford the property? Take into account:
- the loan that you need to finance,
- the rental incomes,
- levies, utilities, maintenance, insurance,
- costs paid to the rental agencies,
- interest rate increases
- legislative costs and conveyance costs
- and the eventuality of the apartment being empty for a month or two.
(Be realistic - it is very important to take into account all the possible costs before you make your investment decision)
Investment in rental property - no short-cuts but definitely worth your serious consideration!