RENTAL INVESTMENT PROPERTIES
Having a secondary stream of income can prove to be beneficial, whether it be $800 or $3000. If you’re in a financial pinch or not, the extra money could come in handy. Though, how do you go about generating that extra source of income? One sure-fire way of doing so and that is by owning an investment property.
Everyone needs a place to stay. With the on-going migration from new job positions, locally, undesirable local living conditions and people wanting to get a fresh start in life, real estate will always be in demand. Rentals tend to be sought after. Before you commit to entering the real estate investment business, you first need to understand the different sides to owning a rental investment property.
- Multi-unit properties, such as apartments, can generate multiple income sources.
- They add a lot of value to your property. Buyers will be attracted to a property that could generate revenue, increasing your chance of sales if you decide to put the home on the real estate market.
- Your renters provide a steady stream of income at the end of each month. If you rent out your place for $1200 a month, that’s an easy $14,400 for a year-long leasing arrangement. Though these are just numbers from an optimistic point of view.
- You can accommodate short-term and long-term rentals, each having their own benefits.
- You’ll be sharing your personal space with others. Depending on the nature of your tenant, learning to share a space may prove inconvenient at times.
- It will be time-consuming, as you are constantly looking at applications and screening clients.
- Building Regulations must be followed in order to convert some properties into legal rental properties. You could incur costs due to necessary renovations.
- Upkeep on minor or major repairs can be pricey, especially if you, the owner, lack the skill, time and tools to do the repairs yourself.
- Tenants aren’t always guaranteed to pay the monthly rent on-time or at all. For some property owners, this could be a major set-back.
Most of the cons listed can be mitigated by hiring a real estate agency to manage your property which will accomplish the majority of the work. Owning an investment property out of the island is also easy to do if you work with a good property manager or management team. A property management company typically charges a percentage of rental income or a flat fee to assist in the operation and management of the rental property. This is, however, only a small fee and you can reap the added benefit of:
- Having your rental properties listed and advertised to prospective tenants
- Leaving the screening process up to your real estate agent
- Letting the agency handle deposits, leases, and (if agreed upon by both the landlord and real estate agency) rent collection, eviction of tenants and management of repairs.
Don’t treat all agencies equally. Take the time to do the necessary research on a company, speak with other clientele and determine who is best suited to manage your property.
One thing to also note is that a bad rental property cannot be turned into a good one by an agency. Your investment may not return the results that you’d expect it to. It is your responsibility to find out the worth of your investment and make the possible renovations to increase your property value if you’re able to do so. Ask your property manager to have a valuation done to determine the estimated value on your investment property.
After reading through everything with careful consideration and determined to have an investment property of your own, you could find out more about the real estate investment business by heading over to Caribbeanhabitats.com to review our full list of services that we offer. We also assist in marketing your rental property. All you have to do is fill out your information here: http://caribbeanhabitats.com/market-rental-property/