You are not alone! Here in the lowcountry, many are seeing the benefits of owning an income producing property. And why not……the rental market is at an all time high. Over 50+ people a day are moving into the area and want to rent before they buy a home. If you are thinking about owning a property for rent, you should have a plan and educate yourself on owning an income producing property. Keep in mind the costs of repairs and upkeep on your rental home. A good rule of thumb is to calculate anywhere from 7 to 15 percent for unforeseen repairs, depending on the age of your rental property.
What are your goals? If the goal is to live passively off the rental income, then you should know how much income you’ll need. Know your income and expenses. Remember insurance, maintenance, management, taxes, utilities and a reserve fund for major repairs that may come up. Learn financing…..talk with mortgage brokers to find programs that will help you to buy properties with a financial benefit to you.
Location, location! Look to buy properties that are near schools, public transportation, trendy areas and areas that have community amenities like pools and hiking trails. Research areas where the rentals are getting top dollar. Would it benefit you to renovate a home in this area that doesn’t have granite countertops or stainless appliances? These are a couple of top list items that people look for in a rental.
Above all don’t go it alone. If you feel that you don’t have time to market your rental and process applicants with a strict screening process then hire a top quality property management company. If you do go this route, research for the best rated companies that offer quality of service and little or no eviction history. This goes along way with knowing that the tenants that rent your home will have been highly screened.
If you have success owning your first rental property then you may want to consider several as time goes on. You can capitalize on this great way to earn passive income!
