Right now, it is truly the golden age of rental property investment. An increasing number of renters are looking for single-family rentals, making it ripe for investors to diversify their portfolio and generation the type of monthly cash flow which can outpace inflation. Continue reading to learn why you should invest in single-family rental homes.
You Receive Income from Renters
One of the most straightforward benefits of owning a rental property is that you can receive and direct and monthly income stream. These rental payments go straight into your business account to offset any expenses, then, pocketing the rest.
If you rent a single-family home for $1,300 per month, and spend $300 month on miscellaneous expenses, that gives you an extra $12,000 annually in your accounts. Of course, while this is an optimistic figure, it is quite reasonable.
Even if you get only a portion of these types of results, that is additional padding for your current income. People need a place to stay, and they often prefer to rent rather than buy.
Still, markets have shown an increase in demand for renting single-family homes. All you have to do is go where the demand is and provide the types of amenities that are popular today.
You’re in Control
When you invest in a single-family home, you are responsible for your success or failure. If you want a better deal, you can find it. If the market becomes more competitive, you can increase your advertising.
If prices go down, you can wait or add more features to the home to make it more alluring for potential renters. Essentially, you are in control of the situation.
You don’t have a boss telling you how to make money for them. You decide how and when you make money. There is a freedom in determining your future. Yet, you still need to work your properties correctly.
You must treat it as a business and continue to nurture it as it matures. It may not be completely passive, but some of the world’s wealthiest people have chosen real estate investing for good reason.
You Receive Sweat Equity
As you maintain and upgrade the property with things such as refinishing the inside, adding new flooring, basic landscaping in the yard, painting kitchen cabinets and adding new siding you can add value to the home without causing a huge debt in your bank account.
Now, you can charge more rent, which will quickly pay off anything you spent on upgrades. Plus, this will increase the value of the single-family home if you ever decide to sell it. If you enjoy a project, then this can be a major draw for investing in rental property.
As stated earlier, you are in control of the financial activity surrounding your rental property. You can earn more just by engaging in sweat equity. And, the return is well worth the investment.
You Get Income from Property Value Growth
Since you own the property, you will get income when the property value increase over time. The value often holds pace with inflation. If you’re lucky, the value may go up significantly in just a few years. This is why it pays off to look at and invest in emerging locations with growth potential.
There isn’t any question that the demand is there for single-family home rentals. It’s up to you to start investing.