Ashe Morgan: Your Ultimate Guide to Real Estate Investment
A real estate property has become a popular investment over the past years, and when it comes to purchasing a property, the first thing that comes to mind is a home. Basic rental properties make up the traditional method of gaining profit, wherein a real estate investor purchase a property, have it rented, and becomes the landlord, who is solely responsible for paying the taxes, mortgage, and the property repairs and maintenance. As a landlord, it is your choice if you want to charge just enough to cover your expenses until the mortgage has been paid for the rental cost to be appealing to future tenants, or to charge more to produce a higher monthly profit. A real estate investor must be knowledgeable about the market, and if needed, will hire an expert for assistance.
If you are looking for a rental property with a good and steady stream of income, you need to consider the location of the property as well as the market rental rates, to align to your competitors, making your property more appealing to future tenants. It is a good idea purchasing a property from developing communities, where new infrastructures are being built while the price of the properties are still low. Of course, you don’t want to end up with a bad tenant who doesn’t pay on time and damages your property, leaving you with a negative cash flow, so it pays off being strict about requirements like demanding a copy of credit report to know the paying capacity of the prospective tenant, and obtain a renter’s resume if possible showing relevant information about character references and previous landlords. Having a rental property demands so much of your time and energy, so it is a good option hiring a property manager if you have several rental properties to handle so you can focus on the most important aspects of managing all of your real estate investments.
If you are not into rental properties or if you think being a landlord is just too tedious for you, you may consider flipping or be a real estate trader, wherein you can buy real estate properties and hold them for a short period of time, usually no more than 3 to 4 months, and in turn sell them for higher profits. A flipper won’t spend anything for property improvements because the real estate investment has to have an intrinsic value to make profit without any alteration. There are also real estate investors who renovate reasonably priced or cheap properties to increase their value, and sell them for a higher price.