Real estate investments is a lucrative investment option due to two reasons. First reason is that even though the growth rate of the investment may be slower, it will definitely offer you great returns when you will sell the property after some time as the rates and value of the properties is always increasing.The second reason is that you don’t have to wait for some time to start earning income from real estate as you can rent the property to a tenant and start earning a sizable amount as a rent for your property. So it means that investing in realestate can offer you instant gains.
Before you make any decision regarding real estate renting, you have to take into consideration, both the aspects of renting a property. It means that you have to study the advantages as well as disadvantages of renting your property. It will give you information with which you can make a balanced decision.
Advantages of giving your property on rent
- The most important advantage of renting a property is the direct income source from the rent paid by your tenants. Which means that you can start earning as soon as you purchase a property if you rent it immediately. This can even help in offsetting the monthly mortgage loan repayments.
- As the values of your property will also increase after some time as there will be growth and development in the locality, you will also get higher price for the property at the time of selling it.
- If you keep your property well maintained and in perfect condition, it will also increase the values of the property and you will also be able to charge more rent from the new tenants.
- You will also be able to claim tax deductions regarding the rented property.
Disadvantages of renting a property to a tenant
- Investment in a property may lock a large amount of funds or debt taking capacity, which may mean that you won’t be able to invest in other options for some time.
- There is always the risk that the tenant may not take care of your property and can cause a damage to the property which may affect its market value. It is also possible that the tenants may not pay the rent regularly and you may suffer the loss of rent.
- It will be your responsibility to keep the property in proper shape as the owner of the property and it may cost you a lot of money.
If we take into consideration both that is advantages and disadvantages of real estate renting, we have to say that the advantages of giving a property on rent are outweighing the disadvantages. This is because you can minimize the risks related to tenant’s behavior or loss of rent by taking certain precautions while selecting your tenant. This way you can ensure that you are getting the rent income and the condition of the property will be maintained and the value of the property will also increase.
The real estate business has seen many up-gradations over the past few years and whit those additional segments to the real estate business, it has turned out to be world’s largest investment market. The market has spread so far that even the farmers have become active investors in the market. This huge change has been because of many factors such as need, profits, returns, low risk, and many more. We have been greatly influenced by the real estate market and now the trend of the investors is moving towards the Renting Real Estate Business.
The Renting Real Estate Segment has attracted a lot of crowd towards itself. The renting business in the market has become popular and also because of its regular profits small and new investors are the major crowd opting for the rental real estate business. So what makes the renting real estate business different from other real estate investments?
The common real estate investments start by selecting a normal property and then they end up when those are sold after couple of years with some healthy profit margins. Here the profit is made but the investors have to wait for a specific time period. Big investors who are there in the market and have ample amount of money can wait for a longer time period, but those who can invest limited and need profits or returns in short time period, the rental real estate is the perfect suit for there need.
In the rental real estate investment the investor has to look for a property that can be set as rented in the market, so that means the property should be connective to the needful places such as , markets, hospitals, bus stands, airports, railway terminals, etc. which means the property should be somewhere in the city. When you have found the right suiting place then you need to purchase it. Now here the trick starts, you need to renovate the property and invest a bit more then when you make it available as a rented property in the market then you will easily get clients who would agree to stay and give you monthly rents.
When you get a small yet handsome amount of money you can easily set up any desired business as you already have constant backup at your back. So this is one of the main reasons that why people who need fast returns or who wants to set a business on the solid basis of investments are trending towards the rental real estate. The real estate business has always been fruitful for the once who makes an investment but with proper research and proper understanding and the people who are not aware of all these circumstances fall into wrong places and experience heavy loss due to insufficient knowledge of the field. So to make an entrance in the real estate world and to start up a business career the rental real estate is the best place to invest in because it will give you results in no time.
One of the most common things brokers and sellers talk about is how to further increase a property’s value – specifically residential houses. Who would settle down selling cheap? Good thing, there are certain ways to force it up by doing some of these quick, practical, and simple actions. These actions are practiced by brokers of Marbella Real Estate, which has been proven to be effective.
Make More Space
Our first tip to increase the worth is by trying to make more space or floor area – whichever part of the house. The more spacious it is… the better. So, you can remove those non-structural walls, those kitchen islands, and anything that hinders a good open space without compromising important functions. It will only cost a few hundred dollars but it can provide an increase of up to 5% of the overall value. Clients with bigger wallets are attracted to this as they can freely customize it without any hassle.
You don’t have to be an expert and you can actually do this yourself if you have what it takes – or invest around another few hundred dollars and have a return of three to five times the amount invested. How? By just trimming and pruning those unattended plants, bushes, trees. Doing so can further provide a better view, lighten the interiors, and will give better aesthetics on the property. And, it can also save you from extra expenses in the long-run as nature may sometimes go wild and can cause some serious damage to the house (molds are one common thing).
Repaint Using Neutral Colors
Remember, you are now selling your property and buyers would love to have a house where they can freely customize on their own with their personal likings. So, don’t be indulge by your own preference, stick to colors that are neutral – like plain white. That way, it attracts and can even hasten the selling process. A new paint job will also give a good increase in value and a nice review.
If you’re used to with having a darker interior, again, change that. Buyers are more appealed to having a more vibrant ambiance – turn on the lights. Replace old bulbs with brighter and better ones. Clean the windows to avoid hindering sunlight from the outside. Remove dark curtains. This way, you can let them see every inch of the house and give them a more secure and comfortable feel. You’ll be surprised how fast you’ll be actually selling when you do this.
Fix the Little But Important Things ASAP
This is what a lot of sellers tend to forget. They forget to do those simple plumbing repairs such as leaks, they don’t mind the rusty gutters with some holes on it, they don’t care about the leaky windows, they forget to insulate the attic, and many others. These little things will go a long way of increase in total value of the house, thousands of dollars for a couple of bucks. So, making sure that before you do silly upgrades here and there, prioritize the simple but important repairs and it may even add a better worth than any upgrade you have in mind.