Investing in real estate is the most popular vehicle of investment in present times. While fixing and flipping may fetch a higher return on investment, it is the concept of renting an investment property that is most popular among investors.
However, buying an investment property is not always a good idea. You should know when to buy and when not to buy an investment property to make your investments achieve the highest possible returns.
Buying a rental income property is not like buying a new car or a television where it is easy to compare products and features. It also depends upon your current financial condition to take a big step of investing in a rental income property.
You commit yourself to your lender to pay monthly installments for the next 25-30 years. You must do your planning and math to know where money would come from for not just mortgage payments but also for the maintenance and repair of your investment property.
Do you have the time, effort and money to manage the property?
Chances are that everything might go as planned and you may start to earn decent rental income to cover all your expenses. But when you are working a 9 to 5 job that eats up most of your time, it is not easy to find time to screen tenants and attend to the requests for repairs and maintenance. We talk about this in greater detail here
In addition to spare time, you also need to have enough savings in your bank account to pay mortgage installments out of your own pocket for times when your property remains vacant. Being a landlord requires a lot of your time and effort besides money at times to manage the property in a seamless fashion. That is where we at IIP Management come in and handle ALL of this for you.
Take a final call when you find an attractive property
Who doesn’t like the idea of earning a passive stream of income month after month? But it is not all hunky dory in the world of real estate and you learn the challenges and difficulties when you finally take the plunge.
Start your property hunt when you have enough savings in your bank account and decide on buying when you find a property at the right price in the right location in the right condition. Be ready to make compromises here and there as you will never encounter ideal conditions in the market.
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