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How to Make Money With Rental Properties

With a smart investment, you can make money with rental properties on a recurring basis.The advantage of making money with a rental property is that you will get money month after month. Although some of this money will go to pay off the original mortgage, with a good rental property investment, you can practically count on a steady flow of income.Read the short guide below to find out how to make money with rental property in basic steps.

Instructions

  1. Talk to professionals and other rental property owners. Be in touch with real estate attorneys, real estate agents, accountants, and other landlords to learn what you can about the rental business. Keep in touch with these professionals consistently both before you buy your rental unit and after you are already renting it out. These people guide you in making the best decisions and therefore the most money with rental properties.
  2. Research the real estate market. Research prices for different types of rental properties in your area. Research both their selling prices and rental prices. You should also analyze trends and future projections.
  3. Decide where you will buy. Location is the key issue when it comes to real estate. You need to choose a location where rentals are in demand and property values are within your reach.
  4. Choose the type of rental property to invest in. Do you want to rent an entire apartment building? Are you interested in just renting a single family house? There are many types of rental units to choose from anywhere from small apartments to large 2 story homes.
  5. Find properties that match your criteria. Look for properties that are good investment deals. Try to find a rental property that is low in value compared to other similar properties. Also look for properties that are in good condition and will not require many repairs. (You might want to invest in a rundown rental property though if you find that it is a very good deal and the repairs are facial and not structural.)
  6. Buy the rental property. This process will probably involve taking out a loan.
  7. Conduct whatever repairs are necessary to get the rental property ready to be lived in.
  8. Find tenants to rent your property. Make sure to run credit reports on prospective tenants. Getting good tenants is important if you want to count on making money month after month. Tenants who do not pay on time or do not pay at all will destroy your rental property cash flow. You should also be careful because there are laws governing evicting tenants, so once a tenant is in your property, you might not be able to evict him easily or at all.
  9. Manage the apartment yourself or hire a property manager (or property management firm). There are many tasks to perform on a regular basis including collecting rent, paying taxes, fixing up repairs, paying insurance companies and more. If you do not have time or expertise to deal with these yourself, hire a property manager to do these jobs for you.