Do you have ambitions of owning rental property one day? Well, let’s talk a little about the pros and cons of owning a rental property. First, let us set the mood.
Let’s say YOU are currently living in a home that you purchased 3 years ago with your “at the time” partner.
Possible outcome #1: Partner leaves you and now you are stuck footing all the bills for this home that you thought would be your forever home. When in fact, you purchased the home in your name only, at the maximum market value.
Possible outcome #2: You marry your partner, start a family, pay off the home in 30 years, and live happily ever after. (The American Dream)(Right!!?)
Possible outcome #3: You and your partner get on good terms with one of your local Real Estate Investment Groups, where you discover that you have been hustling backwards for the last 3 years. (Wake the HECK up!!)
The American dream is just that, a DREAM! There is only one way you get to live life the way it should be lived, and that’s through financial freedom. There are tons of ways to get rich, but your chances are slim to none that 90% of those ways will work in your favor.
Lottery: NEGATIVE
Inheritance: Good Luck breaking the generational curse
Hard Work for 40 hours a week for 30 years: MUAHAHAHAH!!!!
I hope you guys are paying attention. This stuff is free education! This is the stuff your parents should have been telling you instead of sending you to expensive private schools and getting nothing in return. If I am offending you, then good. My goal is to enlighten you, not to baby you. I want you to get up and go get what is yours. No one is saying it will be easy, but you can be sure it is worth it!
GOOD (Pros) to owning Rental Property:
- You collect rent from other people: Now to some folks this sounds pretty cool. Well d@mn it, it is!! People are literally paying your mortgage and increasing your equity. If purchased correctly, your property can cash flow immediately and potentially front you money for an additional property once refinanced.
- The tax benefits associated with owning rental property is a true cheat code. The government intentionally put into place incentives that benefit investors.
- Long term appreciation is a huge benefit of own rental property. Not only are your tenants paying down your mortgage for you (if you have a mortgage) but they are also helping to increase the value of your home over the long term. So once you decide to offload the asset, you should bring in a significantly higher price then you paid for the home.
BAD (Cons) to owning Rental Property:
- Late night tenant calls. These are super annoying and can cost you profit if it is a real issue they are calling about. Sometimes the calls are due to user error on behalf of the tenant.
- Possible loss of profit due to delinquent rents. This can be avoided by properly screening your tenants. Don’t budge on your screening criteria because it will certainly bite you in the wallet.
- Routine maintenance and paperwork. Although I don’t completely believe this is a bad thing, maintenance can be a hassle and tracking paperwork is definitely a hassle.
Ultimately, owning rental property is a win for anyone who has the determination and foresight to take on the project. The reward definitely outweighs the risk when you utilize the proper methods to maximize strategies needed to achieve your goal of financial freedom.
Mission: Financial Freedom 