Archive for October, 2008
Ownership of Rental Property
It can be very beneficial when done in the right way, but there are pitfalls which can occur. This blog discusses the pros and cons of rental property when owning one.
First, the Positive Aspects:
- Rental income can pay off the property over an extended period of time.
- Certain rental expenses are tax deductable.
- Rents tend to increase over time, leading to increased income.
Now, the Negative Aspects:
- There are likely to be expenses from time to time, such as repairs.
- The renter(s) could potentially damage the house.
- The renter(s) could make habitually late payments or skip out.
- If a renter doesn’t renew the lease, there is time and effort involved in cleaning up the house and finding new renters.
With regard to the positive aspects, owners or rental property can realize large gains over a long period of time, both in terms in rental income increases and property appreciation (regardless of the recent real estate bust). Expenses such as repairs, maintenance, mortgage interest, property taxes and personal expenses involved the active ownership, such as travel expenses to and from the property for inspections, etc. are tax deductible. A person can make a living off of rental properties if there is enough income to offset expenses and the cost of living. This usually involves owning multiple properties which have no mortgages or mortgages which have a relatively small principal amount to begin with.
The negatives of rental property ownership must be considered also. If a tenant isn’t screened properly or at all, it could result in headaches, such as trying to collect late payments, a tenant not paying rent, resulting in an often lengthy eviction procedure during which no income is received, and/or a tenant causing damage to the home. Because of this, tenants must be screened carefully. A screening agency could be used for this, although that is not a guarantee that a “bad” tenant won’t be selected. Use of a screening company (check the Better Business Bureau with regard to these companies) should reduce the probability of a “bad” tenant being selected.
As for the rental contract, it is best if a lawyer or tenant screening company is hired to do this. The contract should be comprehensive and include basic items such as when rent payments are due, as well as state the amount of any late payment charges. It should protect the landlord in the event of breach of contract by the tenant(s), such as not maintaining the property or repeated late rental payments.
In addition to the screening process, a landlord must arrange inspections to the property, at least twice a year. It is not uncommon for tenants to damage a home, but periodic inspections can lower this possibility considerably. This involves going inside the home as well as outside. All rooms should be inspected. This inspection process should be conprehensive enough to result in a clear idea as to the condition of the home and property.
There are companies which manage the tenants for landlords. These include screening rental applicants, collecting rents, and informing the landlord on various matters pertaining to the property. They normally charge a monthly fee, which should be considered when deciding to hire a company to manage the property. In addition, the landlord should be there in person when a house inspection is made, to qualify for tax deductions, since a “passive” landlord is not allowed the tax deductions normally applied to rental properties. An “active” landlord can take the usual tax deductions.
In cases where landlords don’t want to have to find new tenants every so often, such as every year or two, a longer lease period could be considered. This would involve either keeping the rent the same for a period of a few years, such as with a four-year lease, or incremental yearly lease increases as agreed between the prospective tenant amnd landlord. This would apply to “good” tenants who have made timely rent payments for a year or two, and usually not to new tenants unless the new tenant has been screened thoroughly and has a very good credit history.
In summary, rental ownership can be very rewarding, or it could result in nothing but headaches. The amount of effort and due diligence of the landlord, both in selecting tenants and managing the property, can make a great difference in determining the outcome of rental property ownership for that particular person.
Miami's Real Estate Investment Opportunities
 |
 INVESTMENT PROPERTIES RENTALS LARGE BLOCK  US $3,800,000.00
|
 Historic Home Rental Property US $295,000.00 |
 Investment Real Estate Rental Property ALREADY RENTED US $46,000.00 |
 6 unit Rental Property Forsale US $16,100.00 |
 Turn Key Rental Property Packages in Flint Michigan US $7,000.00 |
 RENTAL PROPERTY HANDYMAN SPECIAL NO RESERVE US $765.00 |
 Intuit 409946 Quicken Rental Property MGR 2010 US $141.99
|
 NEW Quicken Rental Property Manager 2010 409946 US $137.99
|
 New Intuit 409946 Quicken Rental Property Manager 2010 US $134.99
|
South Florida is in a Real Estate Bust
The real estate investment opportunities are everywhere, the rush to the city to make low-ball all-cash offers for batches of properties is on.
Home prices have come down 24% in the past year, with many places changing hands for less than half their values. Real estate investment opportunities are around everywhere for those with cash. The area has seen foreclosures on as much as $14.2 billion worth of properties. Builders and developers are unable to sell enough units to pay construction loans.
Buying Investment Property the Top is Off the Cookie Jar
The door is open for buying investment property that investors have been waiting for. If you waited out the bubble, then the time is now to make low-ball all-cash offers for buying investment property on the spot. If there ever was a time to start your buying investment property it is now. To get the bottom dollar prices properties investing now is the time to make cash offers. Others have gained their wealth in market financial crises and now the door in open. With some adjustments in tactics the insistence on paying bottom dollar is not going to be a problem with your properties investing.
Buying Investment Property is Easy Pickings
You can get apartment buildings for a steal rent them for a few years then sell for a big price. You can take your pick of apartment buildings with ownership problems and pick them up for a song.
Looking for your Real Estate Investing Information
Visit the board meetings do a little investigation into the status of foreclosures and delinquencies. I will not take you long to put together your real estate investing information to make your move.
The Real Estate Foreclosure Investment is Now
We are hearing stories every day a foreclosed two-bedroom with an expansive view of the bay is listed at $299,000, down from $700,000 a few months ago. Find a real estate foreclosure investment like this and the property could go for less than $250,000. The banks are not pleased about paying a $480 monthly maintenance fees. In this financial crisis sellers have no choice but to cut their asking price every 10 days or so until the investment property moves.
Real Estate Investing Tips
The common guy cannot get a mortgage, and a 40% down-payment is becoming the rule for anyone who can. The real estate investing tips are if you have the cash, you can feast like a king.
Real Estate Investment Strategies are Beat the Foreign Cash
Foreign cash from many countries is coming in by the boat load. Your real estate investment strategies should be to get the real estate properties first. Name your price and you will most likely get it.
Financing Investment Properties
GREAT HOME OR INVESTMENT PROPERTY, MAKE OFFER!!! | US $39,000.00 (0 Bid) End Date: Tuesday Mar-16-2010 18:31:43 PDT Buy It Now for only: US $48,000.00 Bid now | Buy it now | Add to watch list |
HANDYMAN SPECIAL LAS VEGAS 4BED/2BA INVESTMENT PROPERTY
 | US $7,100.00 (27 Bids) End Date: Thursday Mar-18-2010 20:55:39 PDT Bid now | Add to watch list |
BEAUTIFUL LAS VEGAS 3 BED/2.5 BATH INVESTMENT PROPERTY
 | US $5,105.00 (16 Bids) End Date: Thursday Mar-18-2010 19:57:24 PDT Bid now | Add to watch list |
FANTASTIC LAS VEGAS 3 BED/3.5 BATH INVESTMENT PROPERTY
 | US $6,300.00 (16 Bids) End Date: Monday Mar-15-2010 2:02:42 PDT Bid now | Add to watch list |
4 UNIT APARTMENT BUILDING TURNKEY INVESTMENT PROPERTY!!
 | US $39,999.00 End Date: Friday Mar-19-2010 19:42:45 PDT Buy It Now for only: US $39,999.00 Buy it now | Add to watch list |