Friday, 3 December 2021

How to Invest in Rental Properties

 


There are many ways you can invest in real estate. You can invest in rental property to generate monthly passive income revenue from your investment. Rental property can be a commercial building, shopping center, or rental house.

To start investing money in rental properties, you need to do research, such as comparable properties market price, rental market (demand and supply) in the surrounding area, rental rate, etc.

You also need to check with your bank, how much you can qualify for credit to buy a rental or investment property. Most banks will require you to put some down payment to purchase an investment property.


You need to calculate how much is your potential profit by calculating your potential rental income minus all the expenses you need to pay, such as your mortgage payment, maintenance fee, improvement and repair, vacancy rate, advertising fee, management, etc.

Read Also: How to Find a Financial Planner That Will Make You Money

You can purchase a rental property already occupied by tenants or you can buy the property and then find tenants to occupy your property. You want to pre-qualify your potential tenants based on their income, credit score or credit history, criminal background, etc. However you need to practice fair housing law, thus never pre-qualify tenants based on their race, color, national origin, religion, sex, familial status, and handicap.

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