Tips For The Prospective Landlord
These following guidelines will assist you in maximizing your returns from real estate.
Keep Your Expectations Reasonable - Have the goal of positive cash flow, but don't expect to be purchasing a new yacht at year's end. Keep your expectations in check.
Find a Balance between Earnings and Effort - Are you "hands on", or should you work with a property management firm? Current income doesn't seem so great if you are putting in another full-time shift working on your rental property. There are property management firms that will run your rental property for a percentage of the rental income.
Know the Rules - Federal and state laws outline your responsibilities and liabilities, so you can't claim ignorance when something happens. You will have to do some reading; nevertheless, it is better to spend 20 hours in the library than in the courtroom.
Have the Property Inspected - One of the best ways to avoid unexpected expenses is to have the property inspected by a professional before you buy it.
Make Sure Your Leases Are Legal - If you make a mistake on the lease, you will find it more difficult to litigate if a tenant violates the terms.
Make Friends with a Lawyer, a Tax Professional and a Banker - If you find that you like owning rental properties, a network including these three professionals will be essential if you want to increase your holdings.
Make Sure You Have the Right Kind of Insurance - After learning the rules, you will need to buy insurance to cover your liability. You will need the help of an insurance professional to select the proper package for your type of rental property. For your convenience, RDM GLOBAL provides 3 years free Home warranty Insurance and property insurance.
Create an Emergency Fund - This is essentially money earmarked for unexpected expenses that are not covered by insurance. There is no set amount for an emergency fund, some say 20% of the value of the property, but anything is better than nothing. If you are getting current income from a property, you can pool that money into an emergency fund.
Investing in a rental property can be an excellent decision if you go into it informed. Every state has good cities, every city has good neighborhoods and every neighborhood has good properties, but it takes a lot of footwork and research to line up all three. Let RDM GLOBAL be your guide in finding profitable , managed properties.
When you do find your ideal RDM GLOBAL rental property, keep your expectations realistic and make sure that your own finances are in a healthy enough state that you can wait for the property to start producing cash flow rather than needing it desperately. Real estate investing doesn't start with buying a rental property - it begins with creating the financial situation where you can buy a rental property.