Do you know the US housing gained close to $2.5 trillion in value in the year 2020?
While there are endless investment opportunities, real estate remains the best long-term investment plan.
Owning property to rent is one of the best strategies to gain financial freedom. However, becoming a landlord comes with responsibilities, and you may require to hire a property manager.
The Responsibilities may bring doubts on whether you should buy property to rent or not. Before buying property to rent, it’s advisable you understand the benefits you will enjoy.
Here are five top reasons why you should buy property to rent.
It’s possible to gain capital growth in case you purchase a rental property at an affordable price and its value increases with time.
Property value increment purely depends on market conditions like neighborhood development, population growth, and economic performance. You can also add value to your rental property by renovating it.
With an increase in value, you stand in a better position in charging more for the rent. Also, you can decide to sell the property at a higher price than the original purchase price.
Another benefit of buying a rental property is that income is predictable.
Though there may be some ups and downs, rental property investment is stable compared to other markets. For example, the property market is less volatile than the stock market.
Irrespective of the economic situation, housing is a basic need.
When starting your journey in real estate investment, you will require to get approved for a mortgage. Although the mortgage process seems like the most challenging part of buying a home, it’s easier to obtain a property loan than other investments like vehicles.
A mortgage loan provides an easy way out. To increase your chances of getting approved, ensure you have a good credit score and a substantial down payment.
The first lesson you should learn about investing is the power of diversification. To see benefits without risking too much, it’s best to invest in more than one market.
As real estate appreciates with time, make a point to diversify your portfolio with real estate properties. Diversifying offers an additional layer of protection against risks.
Buying a property to lease is a good investment as you can sell however and whenever you choose. Although it’s best to hold onto the rental property for long, you hold the decision whether to sell or not.
There are tons of potential buyers willing to offer cash for homes on sale. Due to appreciation, you are assured of selling your property at a higher price than the initial buying price. This makes selling profitable and exciting.
Is rental property a good investment? Yes, it is for all the reasons above.
There is no better time to meet your financial goals or build wealth. The time to own a property to rent and fulfill your dreams is now. Invest in either market properties or off-market properties to reap fruits for years to come.
For more rental property tips, business and investment guides, please read more of our blog posts.