Anyone who has ever lived in an apartment or rental home has probably always dreamed of what it would be like to own their own home. Something was always going wrong. Landlords wouldn’t make necessary repairs as needed or were simply unforgiving if you were a couple days late paying the rent. That may have been some time ago and now that you are in your own home, you are perhaps thinking of renting it out to subsidize your income while you move to a newer home, a new location or perhaps even out of state.
Before you consider using your current home as a rental property, take a step back and look at the prospect realistically. Becoming a landlord would suddenly thrust you into the world of rental property investments and is this something you are really ready to commit to? Don’t answer that just yet! First, take a look at your options.
A Prelude to Disaster
If one of the reasons you originally purchased your home was because of any of the associated problems with renting mentioned above, then it’s time to walk in the shoes of your previous landlord – you know, that one who wouldn’t send a repairman out on a weekend because of the extra charges incurred. What if that was you? What if you were just barely making a small amount after paying that mortgage on the rental property?
What if your tenants were consistently paying late, messing up your own cash flow to get your bills paid timely? Using your home as an investment in rental properties could be a prelude to disaster. Do you really want to get into all that? If not, then look at your options.
Why Rental Properties Anyway?
So, you’ve always dreamed of that proverbial shoe being on the other foot. You want your chance to be the one calling the shots. There are other investment products which could place you behind the driver’s wheel, but maybe real estate wouldn’t be a good investment at this time in your life.
For example, Max Cash Home Offers provided great insight into 9 Investments with Better ROI than Property Management in a recent blog post. Why not check those out to see if any would be safer for you and will offer a higher ROI with fewer headaches at the same time?
Working Toward Future Wealth
The whole idea of investing is to build wealth. While major real estate investment firms are able to buy and rent large groups of properties, the ‘little guys’ are usually all on their own. Are you ready to hire lawyers to handle evictions for unpaid rents, and pay top dollar for expert workmen when repairs are needed? After all the expenses you incur on just a single home, is it really worth all the time, money and frustrations? You are, after all, looking to build future wealth. That’s what investments are all about.
Those looking for financial freedom at some future date would do well to invest in something that doesn’t chip away at any potential profits. Now then, if you are a large funds management group, then largescale rental investment properties would be a lucrative venture. However, as a single investor, your return on your investment might not be as great as you had anticipated. And, that’s the bottom line. Where can you net the highest ROI?
Excellent advises here before to invest in rental properties.
I also recommend if you want to maximize the chance of a successful short-term rental placement to contact a property manager.