Resolve to Increase Your Wealth With Income Property
What is Income Property?
Typically, income property refers to real estate that an owner purchases with the intention of getting revenue from it in the form of rent from tenants. In other words, the owner buys the property not to live in it, but to rent it out to others at a profit.
How the Math Works
On the expense side, the owner is responsible for paying the mortgage, some or all of the utilities, HOA fees, and property taxes. Additionally, owners are obliged to maintain the property in good condition – appliances, fixtures, infrastructure, landscape, finish surfaces, and more will incur upkeep costs. On the income side is the application fees, rent, deposits, and potentially late fees paid by tenants. Profitability – not surprisingly – means that the owner takes in income that is greater than expenses.
…and how it gets complicated
Many new landlords are naïve about variables that can impact how much it costs to keep a property rented out and maintained in good condition. Some of the negative impacts include criminal acts, lengthy vacancies, poorly done maintenance and repairs, late rent payments, and weather-related damage. It’s not uncommon for inexperienced investment property owners to lose money on the venture.
Minimizing Risk, Maximizing Return
Don’t be discouraged! If you are thinking about investing in income property in 2017, there are ways that you can take charge of your risk and manage your investment profitably. If you are careful about tenant selection and diligent about timely, professional property upkeep, you can be successful as a landlord.
Aim for a 7% ROI
We at Crystal Pines know that people buy income property for one reason: to make money. But, how can you enjoy your hard-earned money if you are under constant duress from all of the obligations you have as a landlord? The answer is simple: hire an effective, experienced property management company that can help you achieve a positive ROI. At Crystal Pines, our goal in this market is to help our clients find property that has the opportunity to cash flow 7% or more, AFTER they pay our fees. And that doesn’t even include the financial benefits of property appreciation and tax deductions that you’ll enjoy with income property ownership! What’s more, we relieve you of all daily tasks and obligations associated with being a landlord – from finding quality tenants to dealing with a broken water heater at midnight, we respond rapidly and professionally … so you don’t have to. As we like to say: Buy the property, not the drama!