If you see a lot of houses for sale in your area and if your area has a large demand for rental properties, you might want to consider buying a couple of houses to rent out. Taking this step will turn you into a landlord, but it can be a great way to make long-term revenue. If this is something you would like to do, here are three tips to help you choose the right homes to buy to rent out.
Choose an affordable house
The first thing to consider is the prices of homes you buy with the intent to rent out. You would never want to purchase an expensive luxury home, for example, to rent out, simply because the market for people who could afford to rent these homes is very small. The market for people who can afford small, inexpensive rentals is typically very large in most areas, which is why you should look for homes that are small and priced affordably. For example, if you can find homes for under $80,000, you might be able to make some money with renting them out.
Evaluate total costs
Secondly, you should always evaluate the total costs before you buy a house to rent out. You should begin by looking at how much you could rent it out for each month. Secondly, add up the amount the mortgage payment would be, the taxes, and the insurance on the house. Next, add in a budget for annual maintenance and repairs. When you have a monthly total for expenses, compare it to the amount you could charge for rent. If your expenses are less than the monthly rental amount, you could consider buying this house, as it could be a good way to make money.
Make sure the home needs facial work only
The other thing you will need to do is fully evaluate the house to make sure it does not have major flaws. Buying a house that needs facial work is the goal, and this means avoiding buying a house if it has major problems with it. If you cannot tell what problems the house has, hire an inspector to do the job for you.
Buying cheap homes to rent out is a great way to get started with a rental property business, and you can find affordable homes like this by talking to a professional such as Steve Cohn - Keller Williams Realty - Petaluma.
Share26 September 2018
When I started looking for a new home, I realized that there were a few things I needed to be careful about. For instance, I really needed to focus on finding a home that would appreciate in value, so I began thinking about investing in the right property. After quite a bit of research, I was able to find a great neighborhood that had a big support system for my family. After we found a house we loved, we worked with a real estate agent to procure it, and it was really nice to feel like we belonged somewhere. Read this blog about ways to find amazing pieces of real estate the first time around.